[Arran]

 You are quite correct in that it is not a very valuable set monetarily, but pre war Philco radio-phono units are NOT very common at all. I don't know if this was a set that your grandfather bought new or if he picked it up in his travel, if he had owned since new I would find some way of keeping it and fixing it up. The chassis in these sets were somewhat harder to work on then others, in part because of the pushbutton assembly under the chassis, but they really are not that bad if you are experienced restorer. The main issues are with the rubber/gutta percha covered wire, deteriorating plastic in the pushbuttons, and failing audio output transformers, and the usual things like dry rotted rubber parts like grommets and shock mounts. The phonograph and radio chassis in this set look almost pristine, clean with no spots of rust or corrosion, the finish on the cabinet does look a little tired and flaky, so that will need to be redone at some point, and the tattered grille cloth of course.
Regards
Arran