The engraving looks quite newto me, most likely done with one of these little engraving machines, normally used for drinking glass.
Maybe someone wanted to use the sword for one of these role play games. The dulling of the blade would also fit to this theory.
What to do with it? Difficult to say. Personally, I would try to polish it off, or at least try to stain the engraving to make it look older and more like the rest of the blade.
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