My suggestion is either chuck it, and get an upper with a rail, or...
Get a cheap "airsoft handguard" off aliexpress (such as http://s.aliexpress.com/NjYBRzE3 - search for 'ar15 handguard'), mount that to the front of the upper and use a one-piece scope mount like this (http://s.aliexpress.com/6RvQVvEn) to span the picatinny rail on the handguard AND the one you're wanting to fix to the upper. That should act as a jig to keep both rails aligned while you figure out how to permanently attach the rail to the butchered upper.
Use epoxy (I'd use Devcon or some other metal-filled epoxy) to bond rail to upper, and wait for it to cure before drilling, tapping and fastening with screws. I imagine there will be a gap between the rail and the upper that you'll need to fill with the epoxy. If you drill/tap before the epoxy is cured, you'll end up oozing epoxy everywhere.
Or, just chuck it and get a railed upper.
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