I know you were working on removing the
damaged Rotor Assembly off the crank. Once that's out of the way, check to make sure the end of the crank isn't bent. If its bent, its a parts motor.
If you can shoot a picture from the front of the engine, it's hard to tell how deep the chip is. Your actually fortunate its
not adjacent to a bearing/load bearing.
+1 on welding the block in either case (no pun intended).
With the rotor out of the way, there should be plenty of room to weld a bead (DISCONNECT THE BATTERY) and another atop the first if necessary, until you reach the gasket surface. With the fuel tank removed(safety/nothing to leak), the welder should be able to lean the bike over on the right side plenty to lay a bead on the left case.
Covering everything under that cover both when welding and then taking a die grinder to clean up excess new weld is a must..
As a side note, on my first Yamaha 125cc, 2 stroke, the PO busted the block where one of four long cylinder/head studs screw into(holds the cylinder and head to the block). What was left of the hole was wallowed out, part of the corner of the block was actually missing. I did pull the engine, head and cylinder. Cases
NEVER GOT SPLIT. My dad brought the engine to a welder who filled in the aluminum hole and then some. After days of filing (I didn't have any air tools, this is about 1972, I was about 16), drilling and tapping by myself, the engine was done. I did have the crank stuffed with rags before any filing but still flushed out the lower end (again a 2 stroke with a closed/sealed bottom end).
Point being, any
good aluminum welder can lay a bead after cleaning it up, some grinding, etc. We did those repairs all the time when I worked in a machine shop years ago. I didn't weld aluminum (everything else), but to do the clean up grinding, etc

. Be prepared to get a dremel and some nice flat files. A little bit of Yamabond (centercase sealer) not normally used on the cover would be a good idea to use on both sides of the gasket when you get that far...