Chris takes the prize (Twisted JD Connecting Rod on Fancy Base) for the correct answer.
The "Northside Friend" was indeed Henry Melk. He had machine tools (a lathe) long before the boys did. Melk's grandson claims he still has that lathe, but it seems to be newer than 1901 vintage.
Melk lived a couple blocks away from Bill Harley's parents home on Burleigh Ave. It's true that Melk's house is still there, although the neighborhood has changed considerably since 1901. The Harley home today is an empty parking lot next to a seedy liquor store.
Evinrude was a good guess and he did have input, but he was never referred to as the "Northside Friend."