I'm not sure how relevant this instructable will be to someone who doesn't own this exact model of scrollsaw. Still, I figure it will help at least one person with this machine who has the same problem I did. Or, maybe it will inspire others to hack their own antique woodworking equipment to make it usable again.
Step 1: Overview
Step 2: Supplies
7/16"-24 Banjo Bolt from http://www.ebay.com/itm/130972167072
7/16"-24 Plug Tap
7/16"-24 Bottoming Hand Tap
1/4-1/2 Tap Wrench
A 10mm drill Bit
A small washer
(The reason you need the special taps is that the threads that this machine's blade-holder screws onto are non-standard.)
Step 3: Remove Wiring and Potting From Banjo Bolt
Step 4: Fill the Cavity With JB Kwik and Re-Drill
The hole I drilled was slightly too large to thread it with my taps, so I had to first fill it in with JB Kwik, wait a few hours, then re-drill a 10mm hole. It seemed a little silly to fill a hole in just so I could drill it again, but it got the job done.
**A cool trick to get a perfectly centered hole on a round part like this is to do it backwards -- put the part in the chuck of the drill-press, then clamp the drill bit to your vice underneath it.**
UPDATE: The JB-Weld gave out after a few weeks of use, so I took the bolt to my local welding shop, who filled it with slag for free. I then re-drilled the hole and it now works great after more than a year.
Step 5: Tap the 10mm Hole
Step 7: Add Bolt to Blade Holder
Next, I screwed my custom bolt onto the scrollsaw until it bottomed out against the washer, then gave it a little extra tightening to lock it in place. (I was a little nervous I was going to strip the bolt's threads, since they are just made of JB Weld, but they have held up to a lot of use so far without so much as getting loose.)
Lastly, I reattached the blade holder, this time onto the custom bolt. The blade holder now sits about an inch lower than it was originally designed to, and can reach down plenty far enough to grab 5 inch scroll saw blades. Success!