Question
If I do "tree surgery" as suggested in that site, how much "healthy bark should I leave? I ask because the trunk is only about an inch in diameter and if I cut away 1.5 inches around each side of the cut, I'll ring the tree. How much bark girth percentage does a tree need to survive?
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The text above is a follow-up to ...

-----Question-----
Last summer I noticed the amber sap lesions on this 2 year tree. I didn't think much of it. I was out pruning in prep for its 3rd year today and noticed it has cankers on the trunk. I cut off the infected branches but there is one canker on the main trunk of the tree near the base so obviously I can't get rid of it. What should I do? I hate destroying such an otherwise beautiful young tree, right at its bearing age too. But I have a peach tree too and don't want it to become infected as well.

I remember now the "old guy" in the neighborhood warning me about some kind of fungus that killed his peach tree and that it's prolific in the area. Should I give up on peaches and nectarines here? Bummer
-----Answer-----
Here is a web site that describes what I think is the problem and some control measures. I would also suggest you contact the local State Agriculture Extension Service and ask them for help. They will have an expert on this type problem.
http://www.caf.wvu.edu/kearneysville/disease_descriptions/omleuco.html

Answer
With a 1 inch diameter there is not much that you can do in removing a canker for the main trunk. I would do nothing but water and fertilize the tree to keep it healthy and see what happens. But do not expect too much from a tree this size that has a canker on the main trunk. You might try just cutting the diseased part back to good wood without going too deep into the trunk (maybe just scrape the canker). I would let the Extension Service expert look at it first.