G'day Hendrous,
Sorry to hear about your issues mate, it sucks when it happens - I've been there many times....
I don't have a petrol KJ and haven't worked on this engine before, however I have rebuilt and replaced the heads on my 4.7Lt V8 Grand Cherokee due to a blown head gasket a couple of years back. Here is the thread:
http://www.ausjeepforum.com.au/forum...d.php?t=104762
For all intents and purposes the 3.7Lt V6 is the same engine with 2 less cylinders, so most stuff in that thread will assist if you're going to tackle the job yourself. It is a big job and tests your patience at a number of stages, but worthwhile if you buy all your parts from the USA (Rock Auto is great) and have a bit of time on your hands. All the information is in that thread FYI.
If you are able to keep the thing off the road for a couple of weeks, my advice would be to pull the heads off, take them to a reputable engine/cylinder head specialist and have them crack/pressure tested and checked for straightness and hardness. Then you will know if it's worth fixing it or not. If they are all good, make a list of the parts you need and order online, wait another couple of days for them to arrive and then bang it back together.
You don't need any specialist tools for this job, other than a torque wrench, harmonic balancer puller, fuel line-A/C line disconnecting tool kit ($20 anywhere) and the usual assorted tools and tricks of the (amateur) trade. It's not that hard, just very time consuming and if the KJ petrol engine bay is anything like my wife's CRD, everything will be tight for space and you're probably best removing the radiator and front end of the car to create more room.
Good luck with it, and if you need any more tips let me know.
Cheers,
Hanna