Since it's a Sandcast, it needs to be repaired, and professionally. I didn't realize when I wrote what I did that it was a Sandacast. Welding those cases is a great deal trickier. The cases are more porous than the later die cast ones, and as such, will bubble out impurities while being welded. It will require tremendous patience to control the heat and duration of it to avoid pockets of spooge erupting on you.
As for repairing chain damage ahead of the sprocket, I would not undertake that wituothout a compete teardown of the engine, heavy degreasing, perhaps a bit of grinding the edges, and welding with copper back shields. Plus, forming a piece of aluminum to match the profile to be seam welded in will take some time and skill.
Defintely worth saving, but definitely needs professional workmanship to come out right and be stable afterwards.