So you are sure that the issue is in the ignition barrel itself? and not the switch where all the wires connect?
I had the switch go bad on a car once, and just changed the switch. in your photo you can just see the screw you undo to separate the switch from the barrel. if you undo this screw and remove the switch you can operate the switch with (i think) a flat head screwdriver.
If it is the ignition barrel a locksmith might be able to fix what you have. Then at least you will keep the same key. id be asking a locksmith what he reckons about it. I don't particularly like the idea of an aftermarket ignition barrel that needs modification to the wiring to make it work.