I would think the magnet is installed with some kind of epoxy and then it looks like a pin or threaded rod is installed in the center. I was looking at a older B&S flywheel and it looked the magnet was built right into the flywheel and then pined. Yes it just looks like just another way to cheapen up on building a engine. If the coil was hitting the flywheel it just seems there would hit marks on the flywheel ? I will say it looks like a defect in manufacturing ? Unless maybe the flywheel was removed and dropped on the floor or hit some time in its life??? Its impossible to know this on a forum. You will need more then a new coil, maybe a new flywheel.