You can do a lot for the look of the metal surfaces without machining it. I cant remember the exact way to go about it but if you go to the "Practical Machinist" forum, then look under the South Bend Lathe section, and look through the many rebuilds they have documented you can find some very interesting ways to bring the metal back to a much better look without machining it or such.
Ofcourse using electrolysis will work but there are some simple ways such as Lemon juice and/or Molassis which will do a surprizing job. Infact I feel like you could get to look like nothing ever happened.
Its nice your bringing her back, they are pretty good machines and its well worth the time and effort. The fact the axis moves very smooth is a good sign that nothing got warped from the heat.
Keep us posted on the results.
Jess
GOD Bless, and prayers for all.