How can I repair a swollen tire allowing visibility on the inner tube (picture provided)?
The picture does not make the situation totally clear, but it appears that tube is not centered in the tire, and the tire is not centered over the rim.  This tends to happen especially near the stem, because the thicker part of the tube gets caught between tire and rim and prevents the tire from sliding into place.

Deflate the tire, then press the valve stem in about 1/2 or 3/4 inch while you wiggle the tire to get it around and under tube.  Inflate slowly, and if you see the same thing again, repeat the process.  It may take two or three tries to get things lined up..

(If, on the other hand, what we're seeing is the sidewall failing and the tube pressing through the sidewall then the tire's toast.)