Any A&Ps on the list? Discussing Cont. A-65

The following refers to an A-65 engine that had a wooden prop in
place, which survived a prop stike unbroken

Some terms were used by my mechanic and I'd like to see if my
understanding is correct:
He said he "dialed-out" the crankshaft and it was out of limits by
..004.
He explained that what he was measuring was the perpendicularity of
the flange (to which the prop mounts) to the crankshaft; that he was
measuring 'wobble'.
Is that a fair understanding of what "dialed-out" measures?
Can you take a guess at what we might find when we open the engine,
based on the "wobble"? - Any idea what the cost to repair might be?
Yeah, I'm grasping at straws - I just don't want to turn this aircraft
over to a salvage shop based on what could have been a $600 engine
repair.[it was this 'wobble' that set off the red light - not the
damage to the landing gear or the struts]
Any advice offered is appreciated.