Dogs eat grass when there is something in the tum which irritates and that they are trying to dislodge.
I agree with tanza and eeefarm. In any case your vet should let you stay with him and hold him during any procedure.
I know it is not easy to be faced with a big expenditure but you have to do your best for this little guy. We all know that when we share our lives with these wonderful creatures.
The full body Xray won't show any soft tissue issues and it does seem to me, from what you say (and I am not a vet either !) that it is NOT a structural problem. I had to have a full body Xray done on Hoover recently and it showed horrendous problems with the vertebrae in her lower neck which is obviously the reason for her screeching as if something was 'jipping' her suddenly when she moved in certain ways. At her age (just short of 12) there is no way I am putting her through drastic, invasive surgery and a very long recovery time. But the Xray was worth it cos I was pretty sure it was a structural problem and now we are successfully keeping her pain free with acupuncture.
However I should opt for a scan of your old darling, especially as the blood work doesn't show anything (which in itself is surprising cos in this day and age. . . it usually does).
Good luck to you both.