Spotlight index has ghost app that I cannot get rid of Spotlight has ghost entries for an USB disk that I cannot get rid of. It links to a bootable usb disk that is not currently connected. I have added that disk to Spotlight Privacy. Nothing I have tried unloading, reseting, deleting and reloading spotlight. Nothing. 

These ghost entries do not show up when using Finder search.

Where are Spotlight caches stored other than .Spotlight-V100 ? There must be a place so that they survive cache rebuilding.

I am on 10.12.1 MBP and it is a clean install from two days. No use of migration assistant, etc. No external disk currently connected. Single partition.
The indexing is not finished, I would wait until it is finished before considering an error. 

If the indexing is still going on 2 days after the clean install, you either have a big drive with a lot of files or it's hung on something. That usually happens with wrong permissions on some files and in worse cases because of I/O errors of the drive. 

In order to check that you should take the following steps:

First: run the Disc Utility found in /Applications/Utilities/ to check your drive and repair permissions. Details for usage can be found on the Apple Support Pages found here

Next: I strongly suggest you rebuild the Spotlight Index in any case. A guide to do that can be found on the Apple Support Page here (In short: Click on the Apple Icon > Privacy > add your drive, confirm, then remove it again)

Most likely your problems will be solved after these steps.