Hammer Restoration

[mklotz]

...I winced to see you holding the handle with your hand while sawing, though....

As did I !

Also, using a chisel with your other hand in line with the blade. If it slips (and, inevitably it will) you can easily sever a nerve, not to mention getting a whole lot of your blood on the project.

And make yourself some proper soft jaws for your vise (or, better, get a proper woodworking vise). That rag and the resulting sloppy grip is going to cost you some time in the emergency room. Using power tools around that rag-grip is another recipe for disaster.