In my opinion, the coin is a genuine 1891-O with some type of accidental or intentional damage that has occurred at some point during its long life. I would find it difficult to believe that a counterfeiter that was capable of producing that level of quality on the mint mark would leave obvious evidence of his/her embossing on the rim. I would chalk it up to environmental or intentional damage to the coin. One possible explanation for the damage may be an attempt at embossing - an individual learning how to drill the edge of a coin on a less valuable piece than was intended for counterfeiting.
I agree. Practice makes perfect. Have it x-rayed and see if there is any hole inside. Could be fun for the educational experience.
I would think it possible for a person to want a necklace and have lady Liberty to hang upright, to drill a small hole in exactly this spot and screw in a looped fastener to run a neckless through. No need for a benzel that way. Any othe explinations?