frozen gear selector on 1300 - anyone shed light?

My humble opinion. Based on your observations and efforts, there is a lot to consider, the rust on the shifter spline is alarming in that it was exposed to water and its inner workings may be as well. You might want to pull the clutch cover and inspect the plates for rust and wear.

So its in neutral, engine runs etc. what did the old oil look like when drained?

Also the clutch slave may well be crusted and corroded. Sitting years without service that long it will need to be replaced. Along with brake system full bleed of calipers and the SMC(it may be failed too).

Anytime the transmission fails like that indicates some form of damage. Suspect it may need to be disassembled. I hope you have a shop oem manual - if that bike were in my shop - its going to be a serious breakdown and inspection.
 
The shifter linkage may be frozen, suggest first taking that off and lubing it all up.
This. It's not an uncommon issue and there were several incidents reported over time before The Great Data Loss. Depending on the miles and overall condition of the bike it might be a good preemptive effort as well as the cause of your problem. Even if it doesn't fit the problem it's only cost you a little time. This is a cheap fix/troubleshooting step and helps avoid throwing replacement parts at the problem. If you have to go into the Big Muddy it's best to wade in and not dive.
 
I rode in some rain last summer, then mine became bound up. It wouldn't "return" after a shift so I had to manually move it with my toe. Sounds like yours is quite a bit worse though. I was able to hose the linkages down with Fluid Film and work it in the joints without a full tear down of the linkage.
 
Mine was seized until yesterday, pretty much the same symptoms. Thankfully an easy fix, the lower ball joint (I'm assuming there's also an upper one on the other end of the rod, I didn't actually see it). But it was absolutely solid. I unscrewed the joint from the rod end, removed the rubber cover, and with a bit of penetrating lube manipulated it until it freed up.
 
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