A 1948 K38 in 95%condition except for the cyl for $300, I'd be on that in a hurry.
The cylinder can be polished back up again.
Cylinders can be tricky to polish though they look easy to do.
Doing them by hand is best if you are not experienced using belt grinder equipment.
The flutes need to be polished as well usually and they can be tricky to do while keeping sharp lines and edges to them.
Then either have someone that hot salt blues 'dunk' the part for you, or Rust Blue it is an option as well. The latter can be done by the person that polishes out the cylinder if you take some time.
The term Dunk usually given to mean a pre-polished part is recv'd by the bluer and then just run thru the bluing operation and returned to the owner.
It gives the re-bluer some quick $$ while the tanks are up and running, as he does not have to invest any time/labor in polishing the part(s).
Usually quite a bit less expensive than having the part polished and blued by the same person.
Plus you can't always know or trust their polishing skills unless you have had contact with them and their work previously.
The other way to a decent blue is Rust Bluing.
If a soft textured type of finish is needed, then a carefully done rust blue will get you there. Either Express or Cold Rust will do it but you have to control the process so it doesn't end up with a heavily matted surface from too much etching caused by the rusting solution used.
Even a high gloss finish can be gotten with rust bluing. It just takes more time and attention to the process and techniques involved.