I wouldn't judge the wear by the lip to any great extent. Part of the lip will be carbon build up. Once the carbon has been removed, you can get an idea of how much the bore has worn.
Using feeler guages, measure the clearance between the piston and the bore wall. Do this front to back and side to side, at the top of the stroke and at the bottom. If the piston to bore clearance is tolerable, you may want to replace the rings only. To do this, drop the sump, undo the big ends and withdraw the conrods and pistons. Hone the bore, and fit new rings, after scraping the carbon from the ring groves. Assemble. This is assuming that it needs doing. What were the compression pressures of the other two cylinders?
You mention that the head has been off recently. Could the gasket have blown due to incorrect gasket fitting? When fitting a new gasket (any gasket in any location) always make sure that the surface is perfectly clean. I scrape both surfaces with a new Stanley knife blade until they are perfectly smooth. This means shinny metal. It does take a fair amount of time and effort to get it that way. Alternatively, you could use a brass wire wheel. Is it a copper or fibre head gasket? Did they use Hylomar? Was it re-torqued at the appropriate interval? If the two good cylinders have good compression, I would be inclined to just replace the gasket properly, and give it a run before deciding on what to do next. Head gaskets are quite cheap anyway.
Aaron.


 
						
					 
					
					
 
				
				
				
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