yea there is no way you are going to hand grind that to the right size. not to mention the heat would warp the whole spindle and take the temper out of the steel.
the best work around i could see is actually cutting the spindle off and sleeving the housing and welding the new spindle end off of another housing. if you really wanted to get in it you can remove the tube from the center section and weld another tube in. you will need some special alignment rods for that though. really you are far better just bolting another in for a few miles.