Is there a separate place for people who've done something really stupid and need to ask if it can be fixed? If so please move this post there.

As I mentioned in a previous post some months ago, I had snapped off one of the bolts attaching the water pump to the block. In the end I decided to try drilling it out rather than welding something on the end - a big mistake as it turned out...
Someone distracted me a bit as I was drilling a pilot hole and I ended up going too deep - probably about 0.5cm, possibly as much 1cm. At the time I was hopeful I hadn't caused too much damage, but earlier today when I finally got the car started again, oil started to pump out of the hole at rapid rate.

I've obviously drilled into something I shouldn't have. I will attach a picture with a red arrow pointing out the area of the problem. I am feeling monumentally stupid and know I have potentially cost myself a fortune. The question is, is it worth me taking the block to a machine shop to try and get it repaired? Not so much costwise - labour is very cheap here and machine shops plentiful and fairly competent. But can the damage I have caused be fixed at all, or is the block likely to be permanently buggered? The hole I drilled stayed straight, despite going too far.
Its also worth bearing in mind Golfs - especially Mk2s, are very rare here, so finding a new block is not going to be a case of just going to the nearest scrapyard. If the damage I've caused really is irreparable, then it could potentially end up with me having to put a Japanese engine in as there's probably only a couple of hundred Golfs in the whole country.
Some good news would be nice, but if it really is bad news for my block, has anyone put a Japanese engine in a Mk2, or know what fits?
Here's the pic
