I have a poor internet connection so I can't see the pics well, but from what others have said I believe it would be salvagable if you wanted to invest 5 to 7 thousand dollars in it as well as several years of work. you could have something to ride.
If not I might suggest getting another XS650 and use this one for parts. If you pull the carbs and use the kick starter and check compression and find it has 125 lbs or better on each side then the engine will probably run. Once you do that
www.amckayltd.com/carbguide.pdf can help you clean up the carbs. If you have all the parts to put together an ignition then you can wire up the ignition with a battery and see if it runs.
Doing all this won't cost much more than time.
This might be worth doing even if you just kept it for parts. Nice to have a running engine if you need one.
Up in the TECH section you can find the electrical heaing and find some wiring diagrams. #4 is a simple diagram that can help you wire up just the ignition.
If it runs you can use the same diagram to wire up the charging system to see if it works. Also nice to have the parts if you need them.
Again this can be done for not much more than time.
Good luck on how ever you choose .
Leo