Cause of Gouged Piston and Cylinder?

I purchased a 05 Rancher not running. After cleaning the carb i got it running but have been tracking down top end noise since then. Yesterday i took the top end apart and found the piston, rings, and cylinder badly damaged. It was running well just noisy. I have ordered a new cylinder kit, but want to make sure i understand what caused the problem before i have it again. The piston and cylinder are scrapped up badly on 1 side as seen in the picture. The bike was low on oil when i purchased it but i changed it prior to running it. The rod appears to be straight, at least i cant see any twist in it with the naked eye. I have seen some thread about the oil cooling fan not running cause some issues, could this be my issue? I didnt drive it much after getting it running but the little i did i didnt notice the fan running.

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