As usual with these projects, there's always surprises. Some good, but mostly not good. I discovered two cracked main bolt bosses on the lower case, so I had to get a replacement. A couple of cylinder fins were also broken.
I ended up getting K3 replacements from a guy on eBay who goes by bobcovintageparts or something like that. I also got the head, just in case. All the parts were excellent, and his prices were good. The pistons and cylinders had minimal wear, especially compared to the originals. The ring end gaps were all about .010 after cleaning up the bores with the awesome ball hone I bought for the job.
The case halves, head, and cylinders were masked to protect the innards and bead blasted on the outside. The head and case innards were soda blasted. Everything got power washed, including all oil passages.
The valves were soda blasted and lapped. All valve seats were smooth and well under the 2mm max. I was a little surprised that the valve springs were all about 2mm taller than the factory spec. I'm not complaining.
Everything got a coat of KBS engine aluminum. This stuff takes forever to cure. I ended up baking it at 200 for a couple of hours.