Yep the knife edging is a sure sign of a back yarder with a die grinder from supercheap who is all of a sudden better than Frank Pons because he heard from a mate this is the go........
If I pull a barrel that the back yarder has knife edged, I usually resign myself to sourcing a replacement barrel beacause if someone has gone that far it is not too much of a stretch to believe that other "performance Mods" have been carried out. I pulled down an engine not long ago that had the classic houso porting plus a turbo crank - slotted with a grinder (but get this-it was done in situ!!).
Moral of the story is do your research, get the word from an expert or pay an expert to do the work. (discuss what you want from the engine)
Generally the factory has researched and developed the design to very acceptable standard, manufacturing flaws such as dags in the casting and port mismatch is usually the only work required to get good reliable power from a Jap performance engine.
Blue printing the stock engine will be best place to start in most cases, that way you will know how well the engine will perform as the manufacturer intended. This is a good place to start - baseline the bike - suck and see.
Carefull attention to detail makes a noticeable difference and is indeed all that most privateers delve into ie; blueprinting, carefull attention to build up and test and tune until the bike is dialled in to suit the rider.
If there is any short fall, performance parts are added to fix the short comings - emulators, aftermarket silencer/exhaust, carb, bars, pegs, springs etc.