There's no way around this - if the top f the spindle has been welded, the spindle itself is scrap. Grind the top off and do whatever you have to to recover the pulley. Remove the blade and boss from the other end. You will need to replace the spindle and all the bearings.
Only you can decide if it warrants the expense! A cheaper option might be a scrap deck from ebay - they usually rust to bits before the spindle bearings fail, so you might get a rotten one with good spindles for next to nothing. Getting these apart after 20 years of exposure to wet grass is never easy, however!
phil_saunders(a)bigfoot.com
Phil Saunders, June 2012