My first Photo Restoration - A real Doozy

I've recently acuired a photo scanner and I've started catalouging our old family photos. This is one of my Mom's favorites. It is over 70 years old. It is a picture of my Dad taken by one of his older sisters'. The original is about 10" high and in rough shape.

To make things even more complex for a Photoshop Rookie like me is that it appears to have been hand painted in areas, as well as a large stain on the left shoulder and face area.

Heres the original :

I've started work on it and I'm enjoying the challenge. My goal is to print and frame this for members of my family, enhancing it to the best of my abilities.

I'm open to any advice from the talented members of the forum. Of course, if any one wants to take a crack at it, I would love to see what someone with real skill can do.

Here is where I'm at after a few hours work.

Thanks for looking