oh no, is this 8.75 housing too bad?

A piece of tubing, pipe or even thick PVC the same OD as the ID of the axle tube is all you need as far as a jig goes. If your wife is a certified welder, ask her how far she would trim back from the bead you are redoing before you go any further. If I was doing this myself, I'd be very leery of the first quarter inch or so of either side of the old weld. Remember that every time you step on the brakes that joint is being twisted.