I think you'd be better off taking the thing apart and assessing what you have before planing too much.
Those pits look too deep to me, but that's just a pic, maybe not. To get a good seal you need the block and head surfaces to be flat and clear of all deformities.
Yes you can sleeve these blocks, but if it's not the numbers matching block you have to save why bother? That and all the other work needed is a lot of money for a unknown block. If the block tests out OK great, build away, but to start a build with a block with multiple discrepancies may not be money wise.
500 HP cost a lot of $$ and 11.5:1 compression ratio, even with aluminium heads, will take race gas to run. You'd have to be an artist to get an 11.5:1 engine not to detonate with the junk they call gasoline these days.
I built my engine to 500HP but it cost more than I paid for the car, and I did all the work myself.
I'm not trying to discourage you but one must be realistic.
I hope the block checks out good on the inspection and you build a great high HP engine.
Just my opinion, I'm not an expert.