That doesn't look like normal ball wear. It almost looks like flaking paint. Was it like this when you got it or has this happened over time. How secure is the paint around it? That would be a tough fix.

I'm no professional playfield restorer but you might be able to get some ideas from my Fire Restoration.

https://pinside.com/pinball/forum/topic/williams-fire-restoration

The thought part is you need to find a dividing line for painting and decal work because it is almost impossible to match paint perfectly. The area that is worn on your machine covers a lot of different areas and dividing lines would be a challenge. I would probably use a mixture of airbrushing, decals and vinyl. I would start by cleaning the entire playfield and then clearccoating it to give you a solid base. Then sand it down and get to work.