I've been following your posts regarding this on Facebook - you could more than likely take this to a small claims court and win the case.
They have sold you an item that was incorrectly advertised and with a ground-off engine number (which I believe to be a legal requirement), as you say, more than likely to hide the origins. The engine number forms part of the V5 certificate for the vehicle, so you should notify the DVLA of the replacement engine number at the time of the swap, but obviously you can't as it has been deliberately removed!
Surely this could also invalidate your insurance (if you wanted to be picky about it!) as the car isn't a 2.5 litre like you would have insured it for!
If it was me I'd be threatening them with legal action and getting legal advice as well as keeping record of all contact with them - it's a miss-sold product on their behalf which you have purchased in good faith, they have tried to hide it by removing the engine number and they obviously won't refund you, right?
My only concern would be if they issued a contract at the time of purchase, stating that all goods must be checked for compatibility/be fit for purpose etc prior to fitment (or something along those lines).
There's always Judge Rinder?! And he doesn't like big fat porky pies!
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