Those are some good sized pits. Probably a bit more than I would try to sand out. Possibly cut on a lathe, but that will greatly change where the cone will sit.
It almost appears as if there is a steel ring as part of the seal that might be removable. Still, that is a pretty complex shape that may well only be available OEM, unless some MTB cones would be close enough.
If you could find a slightly oversized cone, it could be carved to shape in a matter of minutes.