SMART would not have helped you....
SMART would not have helped you, and no other tool on the Earth would either. You likely experienced a controller failure which is the circuit card connected to the underside of your drive. What caused it I can only guess, but probably a marginal chip decided to go south, a capacitor failed, etc. etc. What happened is likely that the when the controller failed it sent signals to the drive telling it to move to an extreme where the control arm has no business being thus causing the tapping sound, and then something probably, literally broke off causing the squealing noise.
SMART is a monitoring and reporting technology, but the monitoring it does focuses on internal drive mechanical performance. Most SMART implementation will not, for example, detect bad sectors on a drive. Tools like Scannerz, TechTool Pro, and I suppose thousands of other tools on the market I've never heard of can detect bad sectors. SMART status only acknowledges a bad sector when a write fails, so you need tools like this to first find the bad sectors and then reformat the drive with a zeroing option to force the drive and SMART to re-map the bad sector to a good sector.
Even this is problematic because weak sectors which can take seconds to read will not be acknowledged as bad sectors using SMART technology. A weak sector can be read and written to but if I understand it properly, the surface of the drive is magnetically weak and the signal it generates on a read requires several tries to acquire the data. Some drives will not mark such a sector as bad until a timing threshold is reached, and in many cases this can be in terms of seconds. Picture if you will, a cache file that needs to be read 20 times with a weak sector that takes 3 seconds to read. Sounds like spinning beach ball city to me! Scannerz is, to the best of my knowledge, the only Mac application available that identifies weak sectors.
SMART technology on hard drives isn't worthless, but I would tend to think it's best to use it to pay attention to problems related to mechanical wear and not be alarmed by something like sector re-allocations unless they're growing abnormally. Like I said at the start, you likely suffered a catastrophic controller board failure, and no tool could have picked that up.
