I wouldn't replace the top tube as that bb size dent won't make this tube fail. Frame blocks won't do much for this particular dent. Filler and a fade in paint job by someone like Cyclart would be the ticket in my opinion.
+1 but I expect matching the paint will be pretty difficult.
As for what it does to the value, good question, but not one for anyone but a potential buyer to answer. It's a bird-in-hand versus bird-in-bush conundrum; when you compare the value of a real bike to that of a hypothetical bike, you get a hypothetical result.