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How much strong are aluminum blocks in contrast to cast metals blocks?
Are aluminum blocks machinable since majority of them suffer structural deformations like cracks, thread lining breakages etc.
I see mostly removal & replacements in most aluminum engines and very little machining.
Some engines have aluminum blocks stock (and they are typically cast aluminum). What engine are you referring to? I've not had any block-related issues with my Mazda MZR (aka Ford Duratec) 2L, 2.3L and 2.5L variants in dedicated sports racer applications.
As David suggests, it depends. For the most part, factory cast aluminium blocks are perfectly fine, even to some multiples of OEM power levels, others are going to be rather more limited, just like OEM cast iron blocks. Depending on the specific engine you have, you should be able to find it's limitations on the inter-web.
Not quite sure what you mean about "machinable"? Some OEM use plated bores that may need to be replaced with sleeves if they can't be otherwise repaired.
There are also aftermarket billey aluminium blocks, which are usually designed to be easily repaired if damaged, and are also made of better alloys and heat treated.
One big advantage of cast iron is it's more thermally stable - it doesn't expand as much when hot, and is more resistant to damage from exhaust gases if a gasket fails.