Eichler heatilator fireplace

Hello, we recently purchased a home on the central coast of CA that is originally an Eichler home, but a previous owner put a second story on it in the 80's and changed around the first floor layout.

The fireplace is a very old (I'm assuming from 1953 when the Eichler was built) heatilator style fireplace that is now seemingly rusted out. We were told by the inspector not to use the fireplace until we had a hole in the firebox welded. We had the hole welded and haven't used it at all. Finally had a chimney sweep come out and he said the heatilator was likely completely rusted out and should be replaced with something else. I didn't fully understand what he was talking about because I really don't know anything technical about fireplaces and I have never even heard of a heatilator style fireplace until buying this house. I grew up with a traditional brick wood burning fireplace and now in my current home (not the Eichler, which is a 2nd home) we have a gas fireplace. Anyway, I think the chimney sweep was talking about retrofitting something into that heatilator firebox area as opposed to replacing. Leaving costs aside, my preferred option would be to completely rip out the entire front facade masonry, stone, and the heatilator all together and put in a normal wood burning fireplace. I want to keep a very clean mid-century modern look to bring back some of the spirit of this Eichler.

My question is, what are my options? What can I technically do with this? I don't even know what expert to call because it seems from my online research that anyone I call will be biased to their own product's solution. I'm hoping through this forum I can really find out about different unbiased options that will lead me into making the right phone calls to get this work done.

Fireplace as it was at time of home...
Fireplace after we ripped out many things from the room.
An image from Houzz.com of generally (not specifically) what I would like ours to end up like.