Howdy, Pard,
All things considered, the "true collectors" put a lot of stock in finish condition. If the mechanical repairs can be made reasonably economically, without showing externally, and the prices are similar, I would go for the one with the better external condition.
NOTE: I would NOT attempt to shoot either of these guns, except perhaps with black powder ONLY. Even then, I would LIMIT the amount of shooting. I saw a very nice .44-40 New Model #3 blown by a shooter who was using smokeless loads from a "remanufacturer" (whatever that means!!!). The first two shots landed about 10 yds downrange. The third blew the gun, splitting the cylinder VERTICALLY, bending the topstrap, and tearing out the forcing cone at the six o'clock position. Unfortunately, the shooter refused to allow me to examine the remaining ammo. I SUSPECT the loads were so light that the bullet jumped out of the case, stuck in the forcing cone, resulting in the remaining smoldering powder igniting. But without being able to examine the ammo, there's no way to know!
This occurred about 15 years ago.
Ride careful, Pard!