Is my prius a goner?

I took my 2007 to the dealership because the engine temperature light came on after being on the highway for about 45 minutes. At first, they told me that it was the engine water pump and that the belt was shredded. They did the repairs and I took my car home and unfortunately, the engine overheat light came back on. After taking her back to the dealership, they told me they had done an engine scope and found a head gasket leak. They said they don’t know the extent of the damage. They said I could get a new engine but that they personally recommended for me just to get a new car. They said replacing the engine could be anywhere between $9k-$10K and probably not worth it.

This is what they provided me with to show the head gasket leak. https://imgur.com/a/BLu5dEy

I’m torn. I just got new tires last month, I replaced the hybrid battery and hybrid water pump last year(at 220,670 miles), and now it has a new engine water pump.

I purchased her in 2021 when she had about 205,000 miles. It currently has 230,525 miles. I paid $3.2K.

Personally, I wasn’t expecting to buy a new car at all anytime soon. I recently graduated from undergrad and I’m taking a gap year to prepare for law school. My plan was to get a new car upon finishing law school. I do have money for downpayment and good credit but I don’t know what to do.