I think the starter motor may be the culprit, Mick. It may be staying engaged, seizing its bearings due to overspeed, and shearing the flywheel key. If the starter has a Bendix drive (helix on the armature so the pinion winds into mesh due to inertia when the starter motor operates, then is thrown out of mesh when the flywheel speed exceeds the starter motor's speed) it is likely that all of your problems have been due to a sticky Bendix - a very common phenomenon on old Briggs starters. If you inspect the starter's bearings you should see evidence of severe trauma, if my guess is right. The bearings will probably be so loose that the carbon brushes cannot operate properly.

If the problem has been caused by the starter, I think at this point you will need to replace it. With regard to the keyway, we do have one thread in which a member MIG-welded a damaged crankshaft keyway - the PTO keyway on a Honda GX160. Here is the thread:
https://www.outdoorking-forum.com.au/forum/ubbthreads.php?ubb=showflat&Number=23509#Post23509

Unless you have access both to a skilled and experienced welder with a good MIG machine, and a milling machine to re-cut the keyway, I suggest you look for a second-hand crankshaft, or a second-hand engine. However it seems essential to fix the cause before you go through a difficult repair process which might come to nothing 30 seconds after you start the engine.