I have an old JAP 7.7 barrel that is all rusty on the outside but has the perfect
chrome lined bore from 1943 and since the bore size at .312 is perfect for
.32 ACP I want to turn the barrel on a lathe to resemble a 12 ga cartridge
with some barrel attached that will be snug fin into NEF single shot 12 ga
gun.

I have a friend that has two upscale metal lathes and I thought I would toss
the idea here first for any pointers. I plan to cut the chamber off the
7.7 and then find a way to ream a new 32 acp chamber into the
barrel where it is shaped like a 12 ga cartridge.

Making 32acp insert for NEF rifle

Initially I wonder if I need to weld up both ends of the barrel
so the lathe will have someway to find the very center of the
barrel before I start turning the barrel.

I plan to shorten the 32 acp barrel so that there will be a foot of
open shotgun barrel for the bullet to travel before exiting
the shotgun barrel.
This will allow all hi pressure gas to slow down before exiting
the shotgun barrel and it should be a very very quiet round.
Almost like a legal silencer I hope.

Any suggestions or pointers ? I may try again with 7.62x39
with another barrel if this works out. I wouldnt shoot a 7.7 JAP
in the shotgun because that would be too powerful.

You'd run the barrel between centers to start with, or put it in a 4-jaw as necessary and index off of the bore. Don't weld on it.

A chrome lined barrel would tear up a reamer in a hurry, seems like. Maybe it would survive one pass? Just a thought, a decimal chucking reamer might take out the majority of the chamber (and chrome), they're cheap enough. Then finish with a 'real' (ie. expensive) chamber reamer.

No idea how easy it would be to un-plate the chrome, or if that's practical.

A H.S.S. reamer will be destroyed if you try cutting a chamber in a chrome lined barrel, it won't get to a quarter of the finished chamber depth before dulling.
You would be better off selling the chromed barrel and buying a standard (non-lined) barrel blank to use for your project.