Do what the book says.

I have never polished the knurling.. but it should be done.

When I installed lip seal in the oe 68 Barracuda motor I installed the crank, thrust bearing and retainer with a lip seal in the block.
Moving the crank back and forth to simulate crank end play, the lip of the seal never runs over the knurling. Check it out yourself.
If you can’t get a good visual coat the rear journal with blue layout fluid or use a magic marker. One could also use a very light coat of a dark bearing grease. Spin the crank a few times and you will see where the seal lip rides with respect to the knurling.
If you polish the journal enough to remove the knurling, the journal will be smaller. That takes sealing pressure away from the lip seal.

I have only ever used rubber seals. I have never polished the knurling off. The only times I had leaks were, I believe, when I had assembly problems. For a given seal retainer (matched to block from factory), I have always been able to get good rear main sealing, sometimes with small drips every time I park it, but usually that is the oilpan seals not the rear main. Doug's book has a good assembly procedure (but no need to remove knurling). I always coat the surface of the retainer and the block groove modestly with Ultra Black and put a spot of that on the mating surface between those two parts where the seal rides.

After I assemble it, there are the two little rubber seal pieces that stick out laterally. I cut those flush with a razor blade before installing the oilpan. You can do it w/o trimming, but I feel it gives a more reliable seal without those little tabs. I also do not use the cylindrical shell plastic inserts on the retainer bolts, but put some RTV in there too.

Many ways work. Mostly it is about taking care and making sure everything fits smoothly without forcing anything.

Lou