I guess if it was just a coolant issue you could take a risk and just do the head gasket (I wouldn't) but with milky oil that would normally indicated some cracking behind the liner allowing it to slip or the slip has caused some seepage.
So my guess is when it overheated it has slipped a liner and blown a head gasket. If so, you will need new liners (top hatted) and as a minimum new rings - you go that far and you might as well do the rest of the engine which does work out expensive.
A side issue not related to your problems. You say it is a 4.6 - have you actually checked this as the 4.6 was not fitted to your vehicle - the engine number is a clue but to be sure a 4.6 crank has 4.6 cast into it - drop the sump to have a look. Also what injection system is on it?
If you want to keep the vehicle than I would be looking for a second hand engine - 3.9, 4.0 or 4.6 - would probably be the cheapest way out of it. Use your current ancillaries.
Garry
REMLR 243
2007 Range Rover Sport TDV6
1977 FC 101
1976 Jaguar XJ12C
1973 Haflinger AP700
1971 Jaguar V12 E-Type Series 3 Roadster
1957 Series 1 88"
1957 Series 1 88" Station Wagon
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