99% chance that the base of the stem being a bit larger than the end of the shank is from wood shrinkage.
I deal with a lot of collectable, long abandoned oldies in "as found" condition, and what's seen here is not uncommon. (Smoking a pipe keeps it hydrated; decades in storage in a dry climate = dessicated / shrunken briar).
The main question here is whether the massively oxidized stem can be brought back to black, or even most of the way there. Based on the photos, I'd say no. The pipe will likely either have to be content with deep green "clouds" floating in its stem, or a legit replica made.
(Provided the chamber walls are in good shape, option 2 would be worth it if needed. Uncommon shape + exceptional nomenclature + acceptable blast = no brainer)