Well I just had my block rebuilt for 1050$ and the story I got from the shop
is that the nubbin is a carbon steel insert which aligns the pump with the
block.
Of course it is removable but nobody ever does, and it has no sealing value.
Yes I did examine the photo and there was *no* gasket (sigh).

Entity Stan Wilder spoke thus:

> If you're thinking that the little 'ring' that is just above the
> oil pump shaft in the illustration is some type of seal, think again.  It
> is
> part of the block and used for alignment of the pump shaft.
>
> Its a seal!
> Nothing personal.. yes its for alignment, yes its a seal, it can be
> removed.
> Machining a flat surface with a ring in the middle is totally
> impractical.
>
> Trust me on this one!
>
> Stan Wilder