That bearing isn't badly damaged, but the wear pattern is all wrong. It would be interesting to see what a piece of Plastigauge would show in the way of clearance. Now, to be thorough, there are three more main bearings and six rod bearings to inspect. That engine was designed to be able to change main bearings "in the frame"- - - - -notice the small anti-rotation tab on the bearing that's up in the block? It's possible to loosen the other bearing caps a little, insert a home-brewed tool made from a cotter pin into the oil hole of the crankshaft, and roll the top bearing shell out by turning the crankshaft. Earlier engines with dowel holes in the block and corresponding nibs on the main bearings required the crankshaft to be lowered 1/2" or more to change mains. That modification to the block and the bearings happened about mid-year 1955, the same time as the change to the low water pump position.
So far, I haven't seen anything bearing-related to cause your squeal. I was expecting to see much more damage to the front main bearing, and possibly a badly scored crankshaft. the surface of the bearing that rides on the crank is made of soft metal, a lead/tin/antimony/copper alloy. "Babbit" metal is one type of bearing material, but there are others as well. The next few layers of the bearing will be copper, and then a steel backing shell. The soft metal is there so debris can score, or "imbed" into the bearing with little to no crankshaft damage. It looks like your bearing has done its job of protecting the crankshaft quite well. Now- - - -slip the lower bearing shell out of the cap, look at the back side, and see if it shows an "undersize" It will probably be marked "STD", .010, .020, or .030, indicating the size of the crankshaft. Reground shafts have been ground down to a smaller size to make the shaft round again, and eliminate out of round or tapered wear. As long as a shaft is round, and not scored or tapered, new bearings can be installed without regrinding the shaft. You're getting close to the point where removing the engine will let you do a better repair job, although untold thousands of stovebolts have been rebuilt with the engine "in the frame" under the old shade tree in the back yard!
Jerry
