Well, I've seen
much worse looking MT250's than yours - it's even got most of the lights! The two I've worked on had multiple problems (tank rust, pump over-oiling, carb leakage, clogged pipe, low compression, cut-up wiring, etc.), many of which I wasn't permitted to work on and still remain.
The sprocket should have an eye-shaped 'fixing plate' with two short shoulder bolts into the sprocket, which holds the sprocket with almost no play at all. I'm going to recommend a PBI 353-13 front sprocket to my friend, as with the current 14T 1st gear still feels too tall and acceleration is weak.
Your flywheel looks like it has a new nut and washer, and possibly slight coil damage (hard to tell from the photo). IMO it would be a good idea to pull it off for a look-see.
A good JB Weld fix should work well - just did a small one this morning.
I'd highly recommend a 30 micron fuel filter, and I shook around a bunch of short sheetrock screws (little bastards were sharp as tacks!) followed by Evapo-Rust on the 2nd MT tank. There's still some fine powdery rust the new 30m filter will catch, but no more petcock-clogging chunks like before.
Ray