On my engines the crankshaft gears are steel, EN8:
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The 2nd shaft gears, final drive pinions, and final drive gears are cast iron:
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The bevel gears in the differentials are also cast iron:
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Cast iron would be prototypical. I am building relatively large engines where tooth loads on the crankshaft gears tend to need medium carbon steels, but I suspect cast iron was used in full size.
I have used cheap gear cutters for experiments, but I'd be wary about using them for real gears. The ones I have never seemed to run true. I doubt that cutting a small number of gears, steel or cast iron, will blunt them.
Andrew