what would cause the scuff marks/drag line near the back of the cylinder??
A holster. Especially if this is a trade-in duty gun.
I would say about $275 delivered is good if you can either verify the mechanical condition or get a guarantee. Looks like a duty gun. Some are finish worn yet mechanically like new, others are shot to pieces. And you have some crap-tacular pachmayr's on there you need to throw away and go buy some wooden concealment grips, so figure another $30 minimum for that.
So if it's over $275, I'd say you can do better at a local gun show, pawn shop or in the penny trader.
would the value of a S&W model 64 with a 2" barrel be more or less or about the same??
A 2" model 10 or 64 will run you quite a bit more - but also be easier to conceal if that is a priority. A 2.5" 19/66 will be even more than that if you feel the "need for speed" (I mean .357, of course). To complete the "Top Gun" allusion and as a trivia note, did you realize a .357 out of a carbine and an F-14 in afterburner have very similar speeds?
That said, a 3" in a K frame usually brings a premium over a 4" or a 2.5" if it is a .357 - in .38 the 2" is usually more valuable as there are relatively more 3" K38's out there (3" 19's and 66's are very pricey, however). You cannot make an absolute statement about value in a S&W until you evaluate frame size, caliber, condition, finish, and production type.