Update: after calling around, the only thing that is "no problem" is finding shops who immediately jump to boring and iron-sleeving the entire block. Millennium tech promptly quoted me to iron sleeve the block, without even asking or seeing the condition of the cylinder in question. CarBahn (Steve Dinan) didn't answer. Lang Racing in California are the only ones so far who understand, and think they know a shop that can do what I am asking, but were only willing to facilitate the process, rather than directly revealing the name of the machine facility. Understandable, they are a business, however I don't feel like working with a middle man if it can be avoided.
Alusil is just a type of aluminum with silicone content through-out. It can be machined just like any traditional block, and only requires special honing at the end to reveal silicone crystals for the piston ring to ride on. For reference, the procedure I am looking for is absolutely possible, and reasonable based on technical articles like this one:
https://cdn2.ms-motorservice.com/fil...ocks_51708.pdf it's also possible to have single, 3mm wall Alusil sleeves installed to retain factory bore size and pistons. Meaning you could effectively repair the countless "bad" blocks out there with damage to one or two cylinders. This service would be absolutely indispensable, and cost effective for the s65/s85 owners.
Strange on how hard it is to find info considering all of the Audi and Porsche guys who have been dealing with this since the 80s. Worst case,
Mahle even offers factory +0.20mm oversized pistons coated for Alusil bores on S65/85s BMW part 11257840920. Just trying to find a shop that can cut and hone the Alusil cylinders properly. Or even better, and a long shot in the US is a shop who will install one Alusil sleeve. It seems to be a very reasonable service to ask for in Europe, with Kolbenschmidt (creators of Alusil) themselves even offering the services and Alusil sleeves for all makes.
Anyway, if you've made it this far: lmk, thanks.