I received a notification of a post of yours on the other current French revolver thread,
http://forums.gunboards.com/showthread.php?t=61471 , but it had disappeared by the time I looked. You described the barrel damage as a bulge, and also damaged forcing cone due to the badly indexing cylinder. My guess is that a bullet failing to enter the bore properly remained lodged half-way along, and was struck by a subsequent shot.
I definitely wouldn't convert this revolver for another cartridge, and least of all .22 rimfire. In fact I would only modify it in such a way that the original parts can be kept in an unaltered state. As for fitting a replacement barrel, if you can get one, it may well be that the misaligned bullet has widened out the rear of the barrel threads, and unscrewing it would both be very difficult, and could strip or widen the frame threads so that the replacement would be a loose fit.
I have a much commoner French 1873 which has had the barrel shortened by about 1/2in., and I have contemplated sleeving a new piece of .45 ACP barrel blank (which is of an acceptable diameter) into the octagonal section with the inscriptions. While this could be done with a simple liner, narrowing down where the threads are, a better way would be to have the front end threaded into the frame, with the octagon and ejector rod housing turned into a simple sleeve. So I have made a rather casual attempt at unscrewing an 1873 barrel, and it is very tight, so I gave up until brass blocks etc. can be made. It would be hard to distinguish this natural tightness from the sort that is ruining the threads as you unscrew. Much as it pains me, since I am usually of the "do it" school of restoration, I think you would be better to call this one a wall-hanger.
There is one alternative. You could make six chamber-length inserts, which would let you do some gallery target practice with a tiny cartridge and, in effect, about a 1in. barrel. This could be .32 Short or .25ACP, bu the best of all, if you could get them, would be the tiny European Zimmerstutzen cartridge, of something under 5mm. ralph h, a poster on the other French revolvers thread mentioned above, knows about these. .22 Short with the bores offset would introduce other problems, since the firing-pin protrusion is so great that it would hit steel. Inserts could be held in place with rapid epoxy, which will remove by heating without damage to the cylinder.
I wouldn't hesitate to improve the finish, in a revolver that always was in the white. But I doubt if you could make it really good without erasing some of the markings, and collectors frown on even removing the burr thrown up around some of the punch marks. I don't believe the "Manufacture" name etc. have these, but the small ones might. Probably there are places you can improve it a lot with succeeding grades of fine abrasive paper glued to something flat, and finally fine emery powder or something on an old toothbrush, to remove discoloration from the bottom of any residual pitting. Things like the hammer top and loading gate could be completely restored, if they don't clash too much with the rest.
The number 100 is consistent with the Sutterlin and Lipmann part of the Swedish contract. They were a pretty notional company, I think, intended to legalise what was really an MAS sale to Sweden. We often regard stampings as a more reliable guide than they in fact were. Maybe someone forgot, or the stamp was broken. Or maybe MAS made and marked a few spares, in case of damage or rejection, or by clerical error.
