Hi again Salty...the video that Jarrad means is the one that Joe Carroll and myself put together to show the removal of the cylinder reel and soleplate complete with the bed-knife blade before going to the engineer for sharpening. Click   
HERE We have also just completed another vid for the replacement and clearance adjustment which is contained at the top of this forum (both posts are sticky).
Thanks for the pics...unfortunately they don't  show the exact area we need to look at....my fault ..I didn't explain what I wanted...can you please take some of the sprocket where it isn't covered by the chain...I need to see the condition of the teeth (ie.) whether they are pointed or not.  
 
 I did see in the pics that the grass deflector has been repaired by the previous tenant... we may be able to source a second hand one for you.
As to where to start...I think that you should consider how far you wish to go with the restoration and how many $$ you wish to spend.
If your machine was mine I would:
1. Remove the 3 bolts that secure the cutter clutch...remove the throttle assembly from the upper handle-bar then the 4 bolts that secure the engine to the chassis and remove the engine and set aside.
2. Using the video as a guide ...remove the reel and soleplate complete with the bed-knife.
3. Decide on a colour scheme for the engine, chassis and cylinder reel. Obtain a set of decals and stickers for the Briggs 3HP and the late model Scotty decals including the handlebar center cover.
4. Take the cylinder reel to the sand or grit blasters and then prime and paint it (or powder-coat it, if you wish....then take it, with the soleplate complete to the engineer for sharpening...(there is a topic on this subject in this forum) Also at this time purchase some new reel bearings.(this will ensure correct clearance when you replace and adjust)
5. Decide whether to strip the chassis completely to sand blast it, or to sand, prime and paint as is; masking off where necessary, including refinishing the chain case cover, grass catcher and handlebar center cover.
6. Grumpy, our resident Briggs guru, will help you decide how to approach the engine in detail then repaint in your chosen colour.
7. Clean and polish all the bright-work.
8. the clutch and throttle cables are secured by clips...obtained from a bicycle shop.  
 
  