RE: Engine failure
The amount of time specified for ETOPS approval is dependent upon the type and the operator up to a maximum of 180 minutes.
To answer the original question about when you decide to divert – it basically depends on how many systems you have. In simple (and generalised) terms when you are down to your last item it’s time to go elsewhere. e.g. – engine failure in a twin, divert as any further loss results in becoming a glider. Loss of air conditioning pack, divert as any further loss means decompression. There are some tricks however; if you lose one of your two generators you can start up the APU and use its generator avoiding the need to divert.