FIRST, remove the scales. Do it carefully... grind or file the head off the pivot pin and punch it out with a 1/16" pin punch. As Live2short says, let them remain in contact with some piece of sanded and polished steel and see it the scales cause corrosion on the steel.
MEANWHILE, hand sand the entire blade, tang and shank and all. Be careful not to cut yourself! Start out with 120 grit or thereabouts and work through a progression of grits up to at least 1000 grit. Remember that the real work is done by the coarsest grit in your progression. Get what you are gonna get, with the 120. The job of the 150 that follows is simply to remove the scratches left by the 120, replacing it with finer scratches. 180, 220, 320, 400, etc each grade must have only ONE thing to do... remove the scratches left by the preceding grade. If you are trying to remove leftover 120 grit scratches with 400 grit paper, you are doing the progression thingie ALL WRONG and will absolutely and definitely NOT get good results. Keep going to at least 1000 grit. Then polish with 3u diamond paste on a felt wheel, turned by a dremel. Mind the rotational direction. If it grabs the edge, your blade is likely toast. The sanding and polishing again is for the entire blade. That means the edge bevel, too. You will have to set the bevel, anyway so no big deal. Anyway, you want to especially remove all pitting from the edge area. Keep going until you get to virgin steel. Most razors in this condition can be restored.
Take your 1000 grit wet/dry paper and glue it to a piece of heavy flat glass, like a glass coffee table, or a 12x12 polished marble floor tile. 1/3 sheet actually works great for this. Hone on the paper, 100 strokes on just one side. Circular strokes are okay, and fast. Moderate pressure. Don't lean on it. Flip the blade and do 100 on the other side. Hopefully you will see the bevel totally free of pitting. If not, go another 100 on each side. Each time you do a side, you are raising a burr on the other side, if both bevels are meeting at the edge. The burr should go completely from end to end. This tells you that you have a true bevel. However, you can't leave that burr on the razor! So when you see that you have a true edge with no pitting in the bevel, do alternating laps, i.e. stroke one side, then the other, then the first, etc. Remember to keep the spine of the razor on the honing surface at all times. To turn and go the other way, always flip the EDGE out, never the spine. As you switch to the alternating laps, lighten your pressure to almost zero... basically just the weight of the razor. The blade flexes a lot under pressure and you want the honing action to take place on an unflexed blade. When finished, your razor should shave arm hair smoothly and easily, and you might get HHT1. At this point, as a newbie, you should consider stopping right there. What you have done to this point is basically you have demonstrated that the blade is or is not salvageable.
Meanwhile, after a few days in contact with the suspect scales, check the sacrificial steel for corrosion. You can replace the scales or reinstall the old ones, up to you. Anyway, it needs scales before you send it out for honing.
Moderate pitting that is not at the bevel is not a serious issue. If you don't get it all sanded out, no biggie, but you will want to be extra careful because rust will take hold in the pitted areas if you are not un your guard.
I give this razor about a 90% chance of being restoreable. Give it a shot.
Banned for Life from "Over There"... TWICE!
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