No, the tire isn't touching the frame. Tire size is actually a bit smaller than what was on there. And I've had that problem before when the back wheel wasn't put in correctly and it was a rubbing sensation, not grinding. Don't know the repair history of the bike as it was bought used. However, I'm willing to bet that hubs have never been lubed going on what I knew of the original owners. The bike is a 90s hybrid - Spec. Crossroads
Maddog- I'm a chicky and I don't see the point of your last statement about brands.