After dropping the pan to check things out, I noticed that the PO didn't put the cam chain tensioner into the slot. That must've caused it to wear out as there were pieces of black plastic hanging off. So off goes the jugs. I cleaned it up with whatever chemicals I had sitting around, including foaming aluminum wheel cleaners. The kind you spray on and then hose off 15 mins later. Seems to work... Then I used a wire wheel (the kind with the red stringing thing on it).
I got a loaner honing tool from Autozone (need to leave a $25 deposit). The stones are huge - covered up over half the length of the cylinders. I guess that'll smooth things out. First time it was too shallow so I went in again faster (using wd-40 as a lubricant). Got it to about 45 degrees. Don't have a measuring tool but my handy ruler says the bores still about 58.5mm so I'm not going to worry about changing the rings that the PO had put in. I'll definitely check to make sure that he has them in the right order and with the right side up. First one should be the chrome ring then the black one but with the bevel down. Then the oil ring.
Ordered a new (used) cam chain tensioner and guide from E-Bay for about $45. Also got a correct oil strainer / uptake because the PO put in one from a CB500 that doesn't have the nipple for the hose.
I don't know what's worst, buying a bike that's been messed with but not completely rusted through or one that's been sitting in a field for 30 years.
There was a big chunk of the fin missing. Contemplated getting it professionally repaired but since the bike's not a show piece, slopped on some muffler repair epoxy I had sitting around. Will sand it down when it dries.
I'll also paint the jugs black to cover up all the crap that's not coming off. Not soda blasting it. I just want a good running bike, not a restoration.