1951 cj3a with 1940s mb motor from a army generator

Me and my son picked up a 1951 willys overland cj3a jeep with a mb l head that came out of a 1940s army generator .for 700.00 .The body was rusted away pretty bad .We got the engine out and pulled apart
And it has some issues and was wonder what y'all would do .
The block has a chip by one of the head studs towards the rear of the block .
Pulled the transmission out and apart and it looks pretty good were going to rebuild it .
We're planing on doing a rebuild on the whole jeep ,my plans are for this to be the last vihecal I buy and drive tell I die and pass it on to my son .and help would be greatly appreciated.
Best regards Chris from Tennessee.

Hi and welcome to the world of old Jeeps.
As far as the chip in the block, it's hard to tell without seeing it. If you could post a picture it would help.
I have 3 old Jeeps, a 1953 M38A1, 1948 CJ2A and a 1951 CJ3A all in restore-able shape. There are pictures of them in my Hi from NW Arkansas thread.