Dear mstrode,
Thank you for logging onto the Healthcare Magic forum.
Your letter is especially clear & succinct.
Judging by your description along with 
MRI report, I would say that  your knee has become quite arthritic.
The increased damage on the medial half of your joint is contributed mostly by the partial medial menisectomy  last year. Normally the brunt of the bodyweight is more concentrated medially than lateral part of the knee.
There is no doubt that there is wear & tear in all parts of the knee.
One can buy time by injection of artificial lubricant into knee joint. Its a process called vissco-supplementation and involves a yearly or biannual  injection of synthetic 
hyaluronic acid ( by your doctor) into the knee. It  helps cut down the pain and makes movement smoother.
The next more invasive alternative is a Partial ( Unicondylar)knee replacement.
The only factors against it are the fact that you have a limited range of motion & that your ACL is already degenerating. Your pain will be relieved but the movement may not improve drastically.
Finally , and the more predictable & better alternative is a 
Total knee replacement.
Your pain will be gone, along with  good recovery of motion in your knee. The only downside is that the modern knee 
prosthesis may last a maximum of 20 years ; after which you will need a revision total knee replacement.
Also, it'll mean your sporting days may be over. Swimming, cycling and golf may be permissable but certainly no more running & contact sport.
I hope that i have answered your questions.
Best of luck!
Regards,
Dr. Mohan Thadi
MBBS, MS, DNB, FRCS