Well, today September 5, 2003 we pulled the piston out. I wonder if this piece was missing for a while and led to the other failure.
When we pulled out the piston some pieces fell out. Probably a good thing I did not drive the car.
Everyone I asked said they believe the cause was detonation. The rod bearing in the picture is from the top and could get like that with the piston being forced down by the detonation while still travelling up. It appears I may have had a few factors contributing to my detonation problem. The head and block were milled a total of 20 thou, low octane gas, timing advanced (was 13-14), boost too high (14-15psi), an oil filled intercooler allowing hotter air, increasing detonation. All these items contribute to detonation and I had all of them.
I plan on using a head saving shim, only using premium gas, installing an A/F gauge, lowering the boost to 12, and I had the intercooler flushed and will do it again. I also will get a new knock sensor, plan on bigger FMIC (front mounted intercooler), and putting in the 40+ injectors I have sitting around.