I cannot answer whether the block that you have can be repaired, I will leave that to others. If you are not able to find another used 302 block, then I would suggest going to the Dart Iron Eagle block. All of your other components will fit. The block comes unfinished and requires honing and some other minor machining. You should be able to hone it to fit your pistons. The block is identical to the 289 and 302, with the exception of improved cooling and it is beefier. Thee are two Dart Iron Eagle blocks available, the more robust Iron Eagle weighs about 195 lbs and is made to withstand 1,000 HP. The SHP Dart Block weighs about 165 lbs and is made to withstand 600 HP.
I just bought an SHP for my 289. It is way stronger than my 1965 six bold block was. My engine builder figures that they way underestimated how much HP it could withstand. Here are a few pictures. By the way, I run distilled water in mine as it is a dedicated race car and therefore I cannot run
antifreeze. At the end of each season I drain the water and then install some
antifreeze for the winter, as it is very difficult to fully drain the water and I worry that some may be trapped and freeze. In the spring I drain the
antifreeze and flush with water.
Jim