How should I restore this painted sandstone bay window?
I'm getting something similar done. Either get a stone mason out to do the job or to give you a quote/some advice. Like you said not a good idea to use cement as it will trap damp and degrade the stone quicker. Use a diamond grinder to get the sandstone smooth and fill in any cracks with lime mortar. Then only use limewash or a good quality mineral paint to finish so it allows the stone to breathe.