I do not find it unusual for there to be no cam bearings. Most aluminum head four banger's do not have bearings for overhead cams. It is pretty rare to see a cam journal or housing get eaten up. If it does happen it could be either debris in the oil or oil starvation causing metal to metal contact. I am assuming they will have to replace the block if cam journal bore is ground up. Only other ideas for fixing is to weld material in the bore and machine it true again, or ream it to a larger diameter and have a custom ground cam with larger journals.
I am guessing that a traditional cam bearing will not work well in an aluminum block. Since they are normally press fit and the thermal expansion of aluminum would probably cause the bearing to spin in the bore at operating temp (or worse). The only other option would be an interference fit bearing, but you would have to heat the entire block to a temperature that would allow the bearings to be inserted into the bores. I think there would be too many variables (expansion rate of block, bearings, the affects of the necessary heat on the blocks hardness, bearing qualities) for it to be worth while.
I would rather just get a new block if it was under warranty. Good luck, I hope it works out that way.
-Muzzy