You guys called it. I had a chance to pull it again and stirred a magnet around and found that nothing was sticking to it. Promising sign I suppose.
One more question on the same picture. If you look at the right side, you will see what looks like stress cracking on the top of the ridges:
Is that normal?
Thanks for all the help. This is my first "real" rebuild where I'm pulling the engine apart and I really don't know what is normal or abnormal, so I'll probably be posting lots of pics of the process with lots of questions. Maybe I'll start a build thread for that purpose.