What was the purpose of machining the edge after the blackout application and what was the function of the groove?
Drum brakes on GM cars had a coil spring around the outer groove. Most likely for Noise Vibration and Harshness (NVH) issues. Kelsey-Hayes and Bendix produced brakes for each of the Big 3 auto manufacturers. The drums were cast by the millions. There was no extra cost involved in having the groove cast in. The spring probably proved ineffective and was dropped to save money.
I have machined many drums in the past. Many castings were off center. The outer diameter was machined to a specific round diameter to avoid wheel interference issues. The manufacturer had no way of knowing what wheels would be attached to the car.