Ok, I got the bottom end taken apart. I am thinking that the bearings that were coated with a friction reducing powder coating made the clearances too tight. The black on the Thrust bearing is the remains of the coating.
So, is the crank worth saving? Can the rods be safely ran after they got this hot? Moral of this story is don't listen to someone that is trying to sell powder coating and has no idea about engine clearance.

Digger73 (Mike)