Nikasil bores aren't able to be re-bored - the lining is very tough, but very thin. IF they aren't damaged from something destroying/gouging the surface, they'll stay perfectly smooth for > 150K miles, easily. But unfortunately, this makes them "disposable" if the surface does get damaged. I haven't yet found anyone who can re-apply a Nikasil lining- there may be a place which does this, but I don't know where it is.
The Nikasil cylinders are definitely better at heat dissipation than the iron lined ones, and virtually don't wear out, but they are a bit like those non-stick cooking pans.
I'd look for a possible source of use nikasil cylinders like ebay, etc. as your best option if you end up replacing it. You could switch to the 78-80 iron lined cylinders, but would also have to switch pistons and rings for those cylinders as well. I also don't know how well the large valve heads work with the older style cylinders&pistons (critical factor would be valve head/piston head clearance or squish clearance).
The piston head does look odd - it does appear like there are valve-head shaped "dents" in to crown. Usually when a valve head separates in a running engine, the damage is more severe and often there is a hole punched right through the piston top. It is hard to tell what happened to that cylinder in the past, but it certainly wasn't a happy thing.
