Best place to ground engine to battery

You want to go direct to the block if at all possible. (And get it away from the AL housing of the pump.) You might want to put a longer bolt through the pump so the threads stick out of the back enough to put a nut and washer there to ground the lug to the back of the pump housing cast in the block. Or use a stud through the pump and block with nuts and washers on both sides at that point.