KZ400 bore and valves question

Im working on 1974 KZ400S and have a few questions. Engine had low compression (~115psi on both) and
there's also a head leak from the left side. So i opened the engine up to check the wear and it looks like
one of the bores has a few scratches. You can feel it on the surface. Other bore does not have any scratches and
feels very smooth.

Would you recommend going with overbore or just hone the bores a bit and fit new piston rings?
Are there any piston movement (left/right) allowed at all? I can slightly move the piston when its fully in the bore.

Also, both pistons have pretty clear impact marks on the exhaust side, i haven't seen this before. You can see similar marks on the valves too.
What could cause that? Bent valves?

I would take it to an auto machine shop and have them measure the bores and pistons to see if they are within spec. If the bores are still within spec you can get away with a hone and rings, but if the bores are worn out of spec you'll need to go overbore.

Ouch. Valve contact on the piston like that is probably caused by the cam chain slipping and putting the cams out of time. Your valves are most likely bent now, the pistons may be compromised if it was bad enough. I would check the cam chain per the FSM and see if it is stretched out. Typically if the scoring is enough to catch your fingernail you need an overbore

Thanks for the replies. Does it make sense to find a good replacement instead of rebore? Im not considering it, just wanted to know if it could work.
I looked at Bore Tech website: $75 for rebore is not that bad.

The 400 engines are generally pretty cheap but can be a little hard to find. You may buy one and be in a simular position as the state of it is unknown, but it will probably be cheaper than the work you need to do. If you can track down some overbore pistons/rings that is an option. You are going to need to tear down the head and make sure everything else is in spec. you will probably need to replace the valve guides, and exhaust valves, but measure first. What is the rest of the bike like? This might be a good excuse to ditch the 400 motor and get the 440. They solved alot of design flaws including the leaky head gasket issue on the later versions. I have never seen an early 400 motor that didn't leak a little at the head.

The rest of the bike is okay and is in the works (bins) too. Im basically going through full teardown and cleaning/fixing/replacing a lot of stuff, but up until this point there was nothing major. I was hoping that engine was in good shape since it ran when i got the bike.
Anyways, im going to get the cylinder off the bike and have someone measure it before i make any decisions.

Would it make sense to get a used cylinder base in good condition instead of rebore? If that's an option it will probably save me a few hundred bucks that i could use
to buy other parts.

I would definitely get new rings and at least do a dingle ball hone in that instance, but yeah a good way to save some cash. Measure your piston/cylinderwall clearence before buttoning it together.