This wear on the inside bend of the fork looks like every other CB500 I've ever taken apart(!). I file/grind off the flares on the sides of the forks and then test the shifting and gearbox functions for full engagement of the dogs in their slots: they should engage no less than 3mm depth. It's pretty rare for the tips of the forks to be worn down such that they won't shift the wobbly gears.
This issue in the CB500 tranny often comes from using too-light oils and/or waiting too long to change it. For example, when I had my shop it seemed like every single 500 owner who came in could not remember the last time the oil was changed, as in, "I got the bike last Spring and didn't change it before winter. This is the first oil change since last year" - and the speedos showed 3000-5000 miles on them. Changing the oil then showed up shiny grit, which I learned later came from these gears-and-fork contacts. I took care of something like 10 of those first- and second-year 500s for those kids, and they were universally the same. They often rode together, too. Tearing one down for a parking-block-pushed-the-oil-filter-thru-the-cases incident showed the center fork looking just like yours: new cases later, the bike worked fine. The last 2 CB500 engines I've had for rebuild here have both looked like yours, too.
In the end, if the gears have not become so wobbly on their shafts that they disengage themselves (manifested as jumping out of 2nd or 3rd gear) they will usually work well enough to ride in normal service. There's several guys out there who will back-cut the dogs for you: that works, too, but will require you be more deliberate with the shift. The 500 would literally let you shift sans clutch once the engine warmed up, with good oils: mine did it without complaint using Castrol XLR 20w50, acting as if the clutch was merely a stop-and-go device.
Worn gear dogs are always a worry: if they are rounded so much that they engage only the rounded portion into the slot of the adjacent gear, then they can push each other apart under load. This causes the jumps-out-of-gear troubles we see once in a while on the 750 (2nd gear, especially). In that case, back-cutting the dogs will straighten things out quite well.
