Kings of Portsmouth were my main dealer, purchased LC second hand from them, and had it serviced regular by them.
As my previous post they eventually accepted a faulty engine under the warranty after 3 visits with oil leak and replaced the engine with only 32k on the clock. Engine was to be wisked away but mechanic let me have a sneaky look first.
Took SEAT two weeks to diagnose, accept responsibility and replace engine, had to piddle about in a 1.0 litre Arosa, zoom zoom.
No probs since.
Is yours an early engine, 60k for the cambelt change, or an AUQ unit? Mine was one of the first AUQ engines.
If they are going to charge 3k for a replacement I would want to see evidence of or reason for failure. 60k is nothing for a modern engine and unless you have seriously abused it and not serviced it I would want some compensation from SEAT.
You say that engine blew at 60k so I would push SEAT under the warranty unless its a low mileage early car well outside the three year warranty period.
Good luck.