What happened to this peace dollar?

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The 'pattern' is similar to what happens when you have sheets of wood or drywall, or something like that,
and your load them into a truck, sliding one sheet onto another, and you dont notice a little stone get in
between the sheets, untill youre unloading, and you slide off a sheet, and you see a scratch like that.
Its a distinctive pattern, in this case probably from swarf, turnings, burrs, or whatever you call it,
thats why you see 2 lines, one is the entry, the other the exit.
Sorry if this makes no sense, makes perfect sense to me, but I might not be explaining it right.

 

All you have to do to find out if it is Chinese or not is to drop it on a table top along with another one you know is good. They will have entirely different sounds. If you had a scale, you could also tell for sure.

 

People used to shave metal off of coins, save it and then sell it for bullion. You see filed rims most frequently on gold coins, but from time to time they show up on dollars.

 

Okay, I got some images of the "O" in GOD. First one is a brightfield image (light coming straight down on the coin), and the second is a dark field image (light coming in at an angle from all directions).

http://img466.imageshack.us/img466/1820/obright2compvu6.jpg
http://img378.imageshack.us/img378/8043/0darkfieldcompmr1.jpg

I also weighed the coin, and it weighs 26.69g, so that seems to be correct.

I've worked with sheetrock enough to understand the analogy - it does look a bit like that, though if this is what happened I'm going to guess that it must have happened to the planchet before striking? Anyhow, heres' a closeup of the headpiece between the E and R and Liberty.

http://img378.imageshack.us/img378/6642/headpiecebrightcompia7.jpg

Under magnification, the filing marks/damage to the rim is quite obvious. I'm not sure what to make of it.

EDIT: Sorry in advance for the large images. Hopefully your web browser can scale them down.

 

In my opinion it's a lamination, which is different than a planchet flaw. A lamination occurs when some foreign substance (string from a rag, "swarf", etc.) gets caught in between the dies during striking. A planchet flaw is an error on the planchet before striking.
Also, file marks were often done at the mint in the early 1800's to get the planchets to weight (I belive) before striking.
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