Uhoh! That isn't good!
Before you think of tearing that engine apart.... (a LOT of work, and very expensive.) I would try one of those HELICOIL kits. The good one brand is "HELI-COIL"
But you will probably need to get the motor out the frame to get at the hole to drill and tap it for insertion of the Heli-Coil. Keep the hole side of the engine downward, and when you're done, use a hose and flush out the crankcase with varsol or diesel fuel to get the crap to come out the hole with the hole side tilted down.
The Heli-Coil will do the job if you match it to the threads (metric) on the oil plug. It is a lot less work than replacing the crankcase! But don't overtighten it again!
If yer scared of it, take the engine to a good machinist or machine shop to get it done.
Good Luck.
I would not let very much aluminum go through you oil pump, the less the better. It's a soft metal, but still, it might score something or plug something if it gets enough. Fine little bits the oil filter should catch.
Maybe you could drill and tap the hole for a bigger plug, but I'm not sure you have enough meat there, ot enough room for the bigger plug the clear the crank case contour on the oustide sealing surface (machined flat part) for the plug....?