It is kind of weird to see the tone ring like that. The do lose teeth from time to time but i would imagine that damage came from you failing spiders.
If the speedometer was working okay i wouldn't mess with it.
Replacement if I remember right.
Take the tires off. Put truck in neutral.
Rotate carrier to get the pin out. take s a 5/16" wrench.
Pull the retaining pin, then pull the big pin.
Once you do that, slide the axles in far enough to pull the C clips.
Then slide the axles out enough to clear the gears.
As you slowly rotate the carrier the spiders will just turn out of their places with the pin removed.
Install the side gears, start the sliders and their washers.
Roll them back into place.
Might take 2 or 3 tries to get them timed just right for the pin to go through.
Once they are timed and will clear the pin on both ends, pull pin back out. Slide axles in. Put c-Clips in. Put pin back in, put retaining pin back in.