Your MRI report focuses on the C1-2 level but the radiologist doesn’t discuss the levels below (C3-T1) which a cervical MRI typically covers. You could have a disc herniation below which is what I would suspect based upon your report of symptoms. You could have torn your rotator cuff too but some symptoms don’t fit as well. There is an outside chance that this is thoracic outlet syndrome.
See:
https://neckandback.com/conditions/radiculopathy-pinched-nerve-in-neck/https://neckandback.com/conditions/rotator-cuff-syndrome-shoulder-impingement-syndrome/ and
https://neckandback.com/conditions/thoracic-outlet-syndrome/
Dr. Corenman