Chewed Up Axel Splines

Forty-nine years of "not so gentle" use- not overly surprising, but not good. I'd be concerned (as you are) about what it may have done/is doing to the sure grip chunk. Take it out and clean it up, as others have said; then test the new axle's splines in the center section. Make sure there's no rotational slop in the splines, and that they fit reasonably snugly. If all is good, go for it. New seals, lube and additive.