Crack or Gouge

[Pete04]

There is absolutely no reason to polish it out. A little old scratch, or a nice new patch of polished metal? Which is more noticeable?

Yes, that's true. The gouge is not in the chamber and so likely won't hurt the brass or function of the arm. In my case the brass (after firing) would be stuck in the chamber and needed to be poked out with the ram-rod after each firing.
I do think however, if the OP does want to reduce the raised portion of the gouge, a dremel tool may not be the best method of removal. IMHO

 

[johnnylo]

Looks like a scratch from someone prying a trapped shell at some point. I think it would be tough to start cracking where it is located. If it were a crack I would expect it to start at an edge, but I do not work with metal only own some....

 

[Claven2]

If I was to reduce the scratch, I would wrap a small bit of fine emery cloth around a short wooden dowel slightly smaller diameter than the curvature of the receiver, then carefully rub out the raised portion of the scratch.

 

[tokguy]

If all else fails, I've an extra receiver laying around. Getting the sewer pipe bbl out is your problem though. But I agree with the other good folk in that it seems to be a non-issue.
Good luck with it.

 

[djt]

I've worked with steel with various chemistries all my life , I humbly recommend a quick flux test . Cheap, fast, nondestructive test