The torch cut is because these days BATFE wants a good bit of the receiver destroyed. The shroud is not considered part of the receiver, so it can be saw cut away from the receiver section. This way the shroud can be welded to a new receiver section, saving a lot of work.
The full shroud and original barrel are why this type of kit has a higher price. Last time these kits dried up original barrels were hard to find. Prices were over $400, just for the barrel.
If you have a lathe and milling machine you can convert the bolt and make the other semi-auto parts for it. You will need to modify the trigger pack also, mill the sear, cut the body for the blocking bar and put in a welded pin to block the selector from going to full-auto. Make or get the blocking bars for the bolt and trigger pack. Get a set of semi-auto springs, firing pin drive spring and stronger small recoil spring. About $8 of 0.058” wall 4130 DOM tubing for the receiver. Get all your measurements from your kit before you take the scrap off by melting the braze with a MAP gas torch. Cut the slots in the new receiver and TIG weld everything together. The bolt blocking bar prevents the barrel from rotating to get around the back of the bayonet lug as it goes in and out. So, you have to remove the bayonet lug. If it’s a two-part lug, remove the backing plate and weld the lug back in. If it’s a one-part lug, mill of the part that sits inside the tube. Sandblast, parkerize and powder coat.