Guntech is right about the barrel bulge.
I had to cut two inches off a Mark V Weatherby, chambered for the 300WBY Mag last summer, for a friend of mine, for the same reason.
The bulge wasn't really noticeable until a tight patch was pushed through the bore, from the breech end.
My friend had been cleaning his rifle from the Muzzle with a muzzle protector and didn't notice the loose area at the start.
He told me about "shooting snow out of the bore" after dropping the rifle on a previous hunt.
He now has a Mark V Weatherby with a 23.5 inch barrel. It shoots just fine for what he's using it for.
As for the pics of the rust in the bore by the OP, that can be cleaned out with JB paste on a tight patch or lapping mandrel.
It won't remove the resulting pits or improve accuracy though.
I would definitely get that barrel cut back to where the bore is tight. Don't be afraid to take it back an extra half inch.
People get all snively over a bit of barrel length coming off for all sorts of imagined reasons.
This also means you will have to work up a new load that will be more appropriate for that rifle. You might get lucky though.
As far as replacing that barrel goes, it will depend on how much you shoot the rifle.
If you're only using it to hunt with and shoot less than 25-30 rounds per year through it, why bother???
Some folks just can't handle any type of defect in the bores of their rifles. They're also the types that think a used rifle should be almost new out of the box when they're looking to purchase but only want to pay half the value.
I wouldn't be too concerned about the imperfections from cutting the rifling, but I would be very concerned about that loose bit at the muzzle if the rifle won't shoot well.