1970 340 SHORTBLOCK OR BOAT ANCHOR?

Unless this was an extravagant engine build with high power, I’d leave that alone. The dowel pin takes all the load here. Smooth it with a file and put in a brand new dowel then gently clamp on a washer and nut. Spray metal, arc weld, etc will cost way too much money and probably damage the block. To keep that surface true, you have to bolt on a flange like the transmissions to prevent the block flange from warping under heat.