Marmelades with a certain bitterness are popular in some areas, eg typical british orange marmelades.
The mistake you made was likely in using lemon peel with the pith still on and on top of it blending it all - Some marmelades use a bit of pith, but these recipes usually involve cutting the peel and pith coarsely then candying it as is.
Mixing your bitter jam with one or more batches of jam that is without any bitter element could balance it to a pleasant level, but there is no guarantee and you could spoil the other batches that way. One could test by making a fresh batch and mixing, say, one tenth of the bitter batch in, then gauging the result.
Making a chutney from it has potential for one specific reason: Chutneys can be made mildly to very salty, and salt is about the only thing that can mask/balance bitterness that is too strong for sugar to balance. Also, bitter goes well with spicy hot, and chutney goes well with spicy hot. Do mind that some of the spices common for chutneys add further bitterness, especially when there are imperfections like too stale hot spices or slightly over-toasted cumin in the mix ....
Acid can also balance bitterness a bit, but in your specific case it is unlikely to help, since your jam is probably already strongly acidic.