The metal duct just above the furnace makes a clang sound when the blower stops which is really annoying at 5AM.
However, it is the HIGH setting of the blower motor which causes the continuous grinding sound. The MED setting seems to be tolerable because I used the manual fan setting many times.
If I disconnected the black wire coming from IR-1 relay on the controller and tied it to the blue wire from motor, it should run on MED speed during heat call too. But I will wait until less cold weather to take that risk.
P.S. The schematic actually shows just the blower. It is a simple old furnace but worked OK all these years.