What is wrong with my Peugeot 206cc?

Had to call out the breakdown as car displayed'insufficient oil pressure'. My garage checked the sensor and found it to be ok. Oil pressure was 10 psi. So took it to Peugeot dealer (didn't drive it) who says there was a piece of plastic from the oil filter had gone into the engine and damaged it that I need a new engine. They can't seem to tell me what is wrong with the engine as they have only done a pressure test and that is now 82 psi. The car was new in May 05, so out of warranty, but has been regularly serviced but last two were not done by Peugeot.Help am I being conned here.