How to address this wear

I would likely have it ground to cleanup and hard chromed and finish ground.
This would be the ultimate repair if the service is available. It does require removing the spindle.
 
Thanks again everyone. Sounds like the speedi sleeve is the way to go. I've used them before on automotive applications where either a non hardening adhesive like RTV black is called for or where locktite is called for. When doing the lathe spindle, should it be done dry or should I put a thin coat of RTV on the spindle shaft before installing it to keep the headstock oil from sleeping through between the speedi sleeve and the spindle shaft?
 
I would likely have it ground to cleanup and hard chromed and finish ground.
I'm guessing that's cost prohibitive for this $1,400 lathe. Any idea what it'd cost to do that? The sealing surface is ~71mm diameter or ~2-3/4" (I'm saying about because I haven't done a precise measurement yet).
 
Speedi-sleeve is double digit dollars. Anything else is over $500, and perhaps a grand.

Based on the condition of that seal fit, I would suggest removing the spindle from the lathe and replacing all the seals on the spindle. this will give you a chance to inspect the bearings, which are likely not in much better shape than the seal fit.
 
Is this just the oil seal area?

If so, EPOXY.

there are better epoxy blends that are glass hard.

You may be able to properly clean the area and then use epoxy to make a smooth back to the original size area to allow the seal to work.

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If that's the chuck end of the spindle, wouldn't the bearing slide off the other end anyway?
 
Abom79 posted a video on YouTube yesterday showing a metal spray repair of a lathe spindle.

 
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