That was out of the upper hose that goes from the thermostat housing to the radiator. The hose was "crunchy" when I squeezed it so I pulled it off and that's what I managed to remove. The hose itself seems to be in good shape except for the rust build-up. When I check the other hoses most have the same "crunchy" feeling. Obviously the guy who owned this rig in Japan rarely (if ever) changed the coolant. On the outside the radiator seems to be in good shape and anything I fill it with will drain right away and there are no leaks. I've flushed the system with some cleaner and plan to flush it a few more times.
Does anyone know if someone sells a kit that replaces every rubber coolant hose? I've seen the kit that 4WheelAuto sells but that's only 3 of the hoses I'd need.