Jake,
If you are capable with DIY mechanics and have the tools then the answer is no, you do not have to remove the engine. Just replaced mine with the help of my son who is a qualified mechanic. There is quite a bit of work involved and if you can afford the £300 to do the complete job then let the clutch specialist garage do it. It is a pain to do! Took us two days
We started by taking out the battery and its boxed surround and tied the panel out of the way. Remove the air filter box, engine noise suppression cover and the engine plash tray underneath. We also found it useful to remove the bolts that held the front bumper to the chassis underneath - just to allow a bit of flexibility. You will have to jack the car body up to give you clearance to work underneath - we used axle stands. Then you need to support the engine on a good trolley jack as you will have to manipulate it later. Also both wheels want to come off and split the ball joints to allow the drive shafts to be pulled out. The gearbox oil will pour out from the passengers side so be ready - about two litres. All the electrical cables will also have to be disconnected along with the speedometer cable. The swine to disconnect and put back is the starter motor. Disconnect the exhaust bracket this will get in the way when you put the clutch back. The Turbo rubber pipes have to be split at the jubilee clips. Remove the engine mounting from inside the engine compartment. You should not have to split the gear lever remote as we left it in place to avoid problems later.
Jack up the engine on the drivers side and undo the clutch housing bolts. Then split the housing and push the gearbox as far as possible to the passenger side, by sliding it onto the chassis - watching the electrical connections underneath the gearbox. You will have enough space to remove the clutch plate, using a socket on the crank pulley to lock it to allow the bolts to be cracked. These are sunken star heads so be careful as they are not chunky - round them off and you are in trouble.
As they say in the manual replacement is a reversal of the previous instructions. Watch the exhaust bracket when putting it back - we bent ours and had to take it off and it needed a real thrashing to straighten it out. It also affects the starter motor fitting. While you are at it you can replace the anti roll bar bushes and ball joints if they are shot at. But be warned the roll bar rubber bushes need compressing to be able to screw on the nut. I used a valve compression tool upside down to make it easy. Let me know how you get on.
Regards,
Ron Murray.
rmurray blueyonder.co.uk
Ron Murray, August 2009