Now go out and buy yourself a 1/4 "Whitworth Plug Tap and clean up those crankcase threads. They are not modern M6 threads, so only Whitworth (or 1/4 UNC) will do. Those blind holes accumulate all manner of muck and dirt and need to be cleaned. Generally all the threads into Alloy on Engine and Gearbox for studs are Whitworth. Majority of the other threads are a fine thread referred to as "Cycle" BSCy or CEI. Have a look in Grandad's toolbox...you might be lucky and find spanners that fit the rest of the bike.
The mangled washer is a tab washer for that locknut. Originally it would have had a tang to fit in that groove in the crank nose. Plain washer goes between oilpump drive scroll and the timing pinion. There is a timing dot on the pinion, it's near the keyway. Heating the pinion with a hot air gun sometimes works to ease it off, otherwise it is a case of a homespun thin jaw puller if the pesky bugger is a tight fit.
Crankshaft (and Magneto) Hammering is a rich man's sport.
Swarfy.