File in /.Spotlight-V100 on bad block So I have a file 

/.Spotlight-V100/Store-V2/9ED490D0-6169-4B28-A1B6-46E34ABD0CD1/5.indexPositions


which when read causes an IO error

disk1: I/O error.
         0 [Level 3] [Facility com.apple.system.fs] [ErrType IO] [ErrNo 5] [IOType Read] [PBlkNum 694560423] [LBlkNum 5087] 
         0 [Level 3] [Facility com.apple.system.fs] [DevNode /dev/disk1] [MountPt /] [Path /.Spotlight-V100/Store-V2/9ED490D0-6169-4B28-A1B6-46E34ABD0CD1/5.indexPositions] 


consistently. S.M.A.R.T status shows no problem, nor does Disk Utility. 

For the moment I'm happy to just move the file away and forget about it, it's not too big; however I can't imagine this would be good for spotlight and would like to repair the damage after the fact.

What would be the best way to handle this situation?
First: do you have a good backup? If not, make one before doing anything else. If you have one, make sure it's up to date (but don't delete the old backup history -- it's possible you'll run into other disk errors, and you don't want to overwrite your last good backup with a corrupted one). Multiple independent backups are also a good idea. Testing your ability to restore from it/them is very good idea.

Read errors that make it through to the OS are a very bad sign for your drive's health. SMART will try to detect drive problems, but it doesn't always work (and Disk Utility doesn't really know how to interpret it very well), so not seeing any problem there doesn't mean there actually isn't a problem. I remember we had a drive come into our shop that sounded disturbingly like a coffee grinder when spun up, but the SMART status came back as verified. We replaced it.

Your drive might run fine for quite a while... but I wouldn't count on it.

Once you have your backups in order, you can delete &amp; rebuild the spotlight database with these commands:

sudo mdutil -i off /
sudo rm -Rf /.Spotlight-V100
sudo mdutil -i on /


It'll ask for you admin password after the first command (note that it won't echo as you type). Be sure to type the second command very carefully. Anytime you see the rm command used with either sudo or -R, that's an indication you're doing something potentially dangerous and should make sure you know what you're doing; in this case it has both, so you should be really awake. For example, if you typed a space (instead of a period) between "/" and "Spotlight-V100", it would immediately set about erasing the entire volume. Did I mention you should make sure you have a good backup first?