from looking at the pix you have, the head gasket failed, notice how the ring around the cylinder opening has come out of place. if you didn't over heat it, you'll most likely not need to surface the head, how ever it needs to be checked for flatness. the reason why shops have them surfaced each time is that it is cheap insurance that the problem will not return.
I also noticed that you have an excessive amount of rust in your cooling system, do you not use coolant?, there is more than one reason for using coolant, it will prevent freezing, it has a higher boiling tempeture, and most important it will prevent corrosion and rusting of internal coolant passages. plain water will not prevent the latter, in fact it will accelerate the effects of electrolisis and over time can and will corrode and rust parts to the point where they can no longer be used.