Ragmas, I don't know what to think of this. Those transmissions will take 40+ horsepower on heavier bikes. I can't imagine how any dealer/mechanic/drunk could break of the end of the main shaft. You would have to hit it with a 10 pound sledgehammer. Then there would be bearing and case damage. And the bike would not move because the clutch would not be attached.
My guess is that it broke in use, either from mis-assembly, an undiscovered flaw, or possibly as a result of the Sprag clutch failure. Some of these failures can be quite violent.
As for the "repair"... Certainly anything can be welded and then re trued/machined, and re-heat treated. But a new shaft would be much cheaper and easier to install. Also, the act of breaking would have damaged bearings. There is never just one failure point in this kind of catastrophic failure.
So I'm not surprised you have strange noises. I would not ride the bike without a thorough assessment and repair.
As for the push to a new bike... Oh My God. There are many times that I encourage a customer to consider all the ramifications of a major repair. This includes a cost/benefit analysis of: repair- other used bike- new bike. Funny thing, it is almost always cheaper to repair what you have IF YOU ARE KEEPING THE BIKE. The cost effectiveness must be amortized over a long term to make sense. If you are talking major repair for short term use or resale, it seldom makes sense.
Based solely on your narrative (remember I only have your side) I don't believe you were treated well on several levels. Bang box!!! WTH! Now what can be done?
If this is recent you might put in a formal WRITTEN complaint with our host. It's not real if it is not written down. You also need to put in a formal written complaint to your state attorney general, office of consumer affairs. You can also complain to the Better Business Bureau. However, they have no real authority.
I am sorry for your troubles. Call me at 360-754-4900. I would be happy to discuss this further.