If it's moving even less it sounds more like either a thrown rod or shifting debris.
For lubing up siezed pistons either penetrating oil or ATF work quite well. The detergents help free it up better than motor oil or WD-40.
I've seen holes in the sides of block ranging anywhere from 1 square inch up to 6" round... it really depends on which rod, what part of the wall and which block casting you have.
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