A quick update - end of the bolt is out. It wasn't a big deal at all actually, it wasn't even too jammed, while he was drilling it it moved. Also removed the roll pin key which had snapped off. Not sure if that happened the first time and the mechanic at the dealership never replaced it (it was NOT noted in my invoice and I wasn't charged for it). My guess is he didn't, and that helped allow the thing to slip. I don't know if I had mentioned but at least one of my belts was slipping (twice saw the alternator brake/battery light combo kick in for a second) and making some burnt rubber smells before they finally came off.
Mixed up some jb weld and put on all the threads in about half way deep in the hole. Sprayed the bolt with pam and screwed it in by hand, a gentle tightening at the end with a wrench. Waiting for it to cure. In the meantime, my dad replaced the roll pin key. 7/8" long (I know), 3/16" diameter (I believe). Also got thinner washer to use instead of the thick one - the reason is that there is about another 4mm of depth to the hole when using the regular washer, and those threads are the best in the hole, so we definitely want the bolt to grab into them.
Will let you know how the jbweld turned out when we pull the bolt.