Manifold/header/muffler/tail Pipe problems of the 2000 Volvo C70

I was driving my 2000 Volvo C70 up a hill 80 miles into a road trip and the car lost power and could not accelerate. The check engine light did not come on and I thought gas was not getting to the engine, I pulled off got gas, then proceeded back on the highway, then the same thing happened. I pulled off the road and there was smoke coming out the tail pipe and under the hood, also there was oil all over the place. There was still no warning light indicator and the car was now idling rough and skipping so I drove 1 mile to a service station. I had the car towed 80 miles back to my home. The mechanic informed met that I will have to replace the engine which only has 100,700 miles. It will cost $4500 to replace the engine with a used engine, $6000-$7000 if rebuilt. I take very good care of the car and do not understand how something like this could happen with no warning. It could have been very dangerous if I was in a high traffic area.