Aye! That's some mean damage! I'm amazed that the tang is so short...on Kurdish khanjars it practically goes through the whole hilt I think. The gluing together could be achieved with a variety of epoxy and forms of cutler's cement...there was a recent post about how to mix some up, and you could use powdered pigment to match the ivory colour.
I have no idea how the blade was originally set, but maybe it would loosen under heat.
As for the blade nick??! I have a similar problem with an old khukri, where a part of the edge had delaminated in time, coming loose after a couple of whacks on a log
I think further grinding would be too destructive in this case, and it would ruin the lines of the blade...
The best and hardest solution I can think of is finding a competent bladesmith who could sort of re-forge and harden the edge...but then could also ruin any wootz structure...alternately, you could use some steel epoxy to fill in the edge so the nick and crack doesn't propagate any further.
14" is huge!! It's almost a short sword...From the cut of the hilt this looks Albanian? It's beautiful, I hoe you can bring its glory back!
Emanuel