Has anyone see this before? It look like a drilled hole.
The history on this engine:

I had bought a running engine (year unknown) about a year and a half ago from an auto mechanic. Apparently he is a mechanic trainee. The guy pulled it out (the day before I pick it up) to install a Chevy 454 engine. He didn't state anything was wrong with the engine (and I didn't ask). I was planning on overhauling it anyway. I had the heads off for a while and saw nothing wrong with them. This week I was able to disassemble the block. Found several problems with it. The oil filter by-pass valve was installed in the wrong hole (it was blocking the oil from the oil pump) look like he converted it to a spin on filter and afterward maybe causing oil pressure issues. When I pulled the pistons/rod assemblies two of the pistons had issues (one what a broken top ring and the other missing half of the broken ring). Long story short I have a solution for all of this, I just needed to share my experiences with this engine.