You cant weld Steel to China-Lume ( aluminum of any type for that matter... you cant weld an allow to steel unless the steel has a heavy zinc plateing and then there is a way to torch weld the aluminum to the steel that is zinc plated but it isn't very strong, I've done that before just messing around. again you cant arc weld steel to aluminum period..... dont try it or you will ruin the jug on your engine, a new jug is only $23 or so, so if it does get ruined its a cheap quick replacement fix.
or the whole shooting match for $42 shipped to rebuild the entire top end.
Take the advice from others here and either heli coil the thread holes or just drill and retap them for the next metric size bolt which will be M8x1.25 or if you want to really keep it simple, you can tap the holes for a 1/4-20 US thread and use 1/4-20 studs, I have done that on engine mounting holes that got wallerd out, I use Red Loctite on the studs instead of the Blue lately, the red will still come loose but it holds much better than the Blue and I have yet to need heat to get the studs loose when secured with the red loctite.
I also double nut the exhaust studs instead of just using lock nuts, double nutting them adds a big extra lever of security and they will NOT come loose if done properly period.