I was told if you remove the head bolts they must be replaced with new . Mainly because of the Aluminium Head. Something to think aboutFrom what I've seen with that code, it happens when the engine doesn't reach normal temp (like when the T-stat is stuck open or the fan clutch isn't working right). A blown head gasket usually happens when you have an overheating problem. Maybe the code is coming on because your temp sensor is off and your really running too hot??? (I dunno, just guessing).
I have no problem with him trying to save you some $$ by tightening the bolts, but IMO...knowing that you may need a new gasket anyway, why would he replace the H20 pump & timing chain...why wouldn't he just re-torque the bolts. When he replaces the head gasket, he's going to have to take them off again, thus basically your paying him to do the same thing twice.
How many miles does it have on it? How was it running? Does it blow any white smoke?