The first question is whether to modify / repair the
existing radio vs. cannibalizing it. If you want to
make use of the existing tuning and frequency
readout, then modification might be a better
approach. If you want the adventure of building
your own radio from scratch in a different
case / form factor, then cannibalization may
be a good choice.
The next question is what type of components
it uses. If it is a dense array of unmarked SMD
chips, you may have trouble getting the parts
off the board, and identifying and reusing them.
While through-hole parts are often easier to
get off the board, if all the functionality is
contained in 3 or 4 integrated circuits, there
might not be a lot of practical difference
between modification and cannibalization,
as the easiest way to use the ICs may be
to keep them on the original boards (which
could be cut apart if you only want to reuse
part of it).
If it is mostly discrete parts, then you could
strip them all out and reuse them. The
leads will generally be cut pretty short, so
they aren’t always as convenient for
prototyping, but I’ve used a lot of salvaged
parts in dead-bug construction.
As far as functionality goes, the Sony should
contain an audio amplifier that can be reused,
and some IF transformers. If it is all
discrete parts, then you would also have
some small-signal transistors, though nothing
that would handle 1 W output for a transmitter.
Again, it depends on the circuit: if all the RF
circuitry is in a single IC, it may be easier
to reuse it for the intended purpose, but
not to build something else.
The tuning system is probably far too complex
to duplicate, so would either need modification
or something totally different.
As far as modification goes, adding a BFO or
product detector to copy CW and SSB might be
all that would be required (along with repairing
the radio, of course). By making the BFO
variable, you probably can get around the
1 kHz tuning steps. Additional filtering would
help, of course, but that could be an audio
filter using a couple ICs (or changing the
components around the existing audio
amplifier circuit).
Looking at the schematic, and the circuit board
inside the case, to see what parts might be
salvageable, might be good initial steps to
help you decide how to proceed.