I have really old 2 handled waltec shower faucets that are dripping and I know the reason why. I have replaced the washers on the cartridges, but the seating inside the tube appears to be pitted around the perimeter so that the new washers cannot make a perfect seal.

Does anyone know if that part is removeable from inside the tube, or do I have to go with a whole new faucet and diverter fixture using one of the later round coverplate upgrade/modifications.

This does not sound like a cartridge at all, sounds more like a valve stem. Seats can be replaced or resurfaced with a special cuter than sits inside the valve body.