Well, I wouldn't expect the block to crack by itself- if there is a crack, I would expect that it was caused by driving it while it was overheating. Overheating and coolant loss may have been caused by something as simple as a leaking rubber hose or plastic coolant flange, or a bad coolant pump, or a failed head gasket.
I'd say, for a 1997, that's a lot of money. You'd have to consider what you think the condition of the rest of the car is in, and what it is worth in that condition if the engine were fixed. No use paying $8k to have a car worth $5k, right? Of course, if you're not looking to sell it, just keep driving it, what would it take to put you in a comparable car? And how reliable are the other parts of the vehicle right now- the suspension, the brake system, etc. You don't want to put a lot of money into it if other systems are going to fail and cost even more.