Rod knock turns into 'throw a rod' quickly if you drive on it. Then sometimes you get a nice window to see the rod say "Hello" out the side of the block. Incomplete ignition due to lost compression will throw fuel out your exhaust - that could be causing the smell.
I would not count on driving it anymore. Find a replacement KA engine. Try
www.car-part.com - online junkyard database sortable by zip code. Good luck!