That type of damage can be welded up, but the heat put into the head during welding will likely warp it a small amount, requiring the head to be surfaced (plane the gasket surface) by a machine shop. It may take .010 or .015" to clean up.
You also will have locally "drawn back" the heat treatment of the aluminum material in the area of the repair. A purist will say that you have to re-quench and temper, but a softer spot on the head may or may not be a problem. It is reasonable to take a chance on that considering the savings.