Rot in window frame - advice

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Hi! I'm a bit of a novice & looking for advice. I'm installing a new timber (cedar?) window in a single storey weatherboard house. I found one for free on Gumtree and thought I could fix it up. It needs new sashes (= window company, making new sashes is definitely beyond my ability), but I thought the frame was solid and just needed a good sand, putty and paint. But in the sanding process, I found an area of rot in the side of the frame. If you open the photos, you can see the overall window, and the part where I've scraped out all the rot back to good timber. In the worst bit, about 50% of the cross-section of the side piece is gone.

Now I'm not sure whether to
a) putty it up and hope for the best :C
b) remove the side length of timber, get the window company to make a new piece to match, and reattach it ($$), or
c) give up and buy a new window ($$$)

Any advice would be appreciated - I really don't want to want to install a big window that will need replacing in 3 years. Thanks!
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