I wouldn't hack off the bed .....
It may be that the head can be rotated for "outboard turning" in which case you could use it like a flat faced disc sander with variable speed motor.
If the head cannot be rotated, then mounting a holding system upside down over the lathe bed (with chisel pointed down on the side of the disc coming up - the BACK SIDE of the lathe) would work just fine too.
Or you could just mount your holding system just off the center line at an angle that is comfortable to work with, so that the lathe bed is not in the way.
You never know when you'll want a backup lathe for other purposes ... such as a dedicated pen blank drilling system, or for pre-forming your blanks before you drill and tube them.
Last, but not least, there are a LOT of us new turners running about out here. A lot of us can't afford to run out and pay 5 or 6 hundred dollars on a new lathe, much less the 3,000 some people are dropping on a brand new deluxe system. Many of us would be happy to give that old Craftsman a new home and some TLC for a long time to come. Figure out the cost for packing it up and shipping it and what you'ld like to get for it, and post it in the marketplace. Like Lucky says, it will sell, if priced right for one of us out here. And then you could put that money towards a dual speed grinding wheel sharpening stone system, or pick up a jig that works with an existing sander that you may already have on hand ...
A lot of us use a sander rather than a grinder. There are a LOT of different systems out there to properly maintain or re-grind a new bevel, as well as give you the proper cutting edge on all your tools.