The later model 3400s had almost that
same exact axle. I had one that the
bushings were okay but the thrust
bearings were shot.
When I put new bearings in it I found the
same problem as you have.
What I did is brought both the spindle
and steering arm to a machine shop and
they cut a new keyway in the spindle and
broached a new keyway in the steering
arm. I think I had them do it about 60
degrees away from the original one but
it's been 15? years since I had it done
so ask their advice on the placement.
That is a special size woodroof key and
they did not have a milling cutter for
it. So we just milled a straight keyway
and used a 1/4" square key.
They were concerned about getting the
alignment of of the slot on the shaft and
slot on the arm exactly the same as
before but I told them a couple of
degrees one way or another can be
adjusted out with the tie rod adjustment.
I hung around and watched them do it and
both cuts together took about an hour so
it was not to costly to have done.
Looking at your upper spindle it appears
to be more worn than I thought. Can you
post better photos of it? You might ask
them about welding it up and turning it
back to standard as we talked about
before.