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Looks like your father did a very nice job sporterising the M91. While it has no "collector" value so what? If that were mine and my Dad had sporterised it and used it that rifle would be far more 'valuable" to me as a family heirloom than any "collector' grade M91 would or could be.
Yes it is entirely safe to fire modern ammo in it. Modern ammo (Norma, PVRI and Hornady) are all loaded to the original pressure levels. I have pressure tested all of them with an Oehler m43. The are actually less pressure than the
Argentine
milsurp that I've tested. I've found the Hornady 7.65 Argentine at Cabella's without problem. It is loaded with hornady's 150 gr SP (.312) and chronographs 2761 fps out of my 24" barreled M91. The pressure is 53,200 psi(M43) which corresponds fairly well to the old 45,000 CUP pressure for SR Mausers. It also is quite accurate in my M91.
Were I you I would get some factory ammo and a reloading outfit and use that rifle on a couple deer/pig hunts or maybe and antelope hunt. Loaded with the .311 gr Sierra gamekings at 2550 fps it would also make for a nice elk rifle. Use it, think of your father, and pas it on in the family so they will remember you and your father.
Larry Gibson