A $100 door won't last as long as the paint job on that old door. What is that in the top right of that pic.?

$100 door will probably outlast some of the $500 doors :-)

The place is about 100 yrs old, and that door was likely a home made job, really adds a lot of character, so I’d like to hang on to it.

Coild I get away with just installing a threshold on the concrete without building a sill?

discoloration in the top right is just a spot that needs new paint, I think the knotty pine really sucked it up in that spot over time.

Where do you anticipate puttin this "threshold"? Why is there what appears to be a 3"+ drop?

That drop is where the floor ends. I’m considering either putting a threshold directly on the concrete under the door, or building a sill to go between the jambs where the floor ends and then attaching a threshold over the sill/concrete