night pix .... hey.. wait a minute.. did you dig it up ... lol ... night pix throw off color ... it looks like a bird sown Juniperus virginiana ... which I CONSIDER an invasive weed in my MI ... [not a spruce.. nor a picea.. nor a pungens] down south.. they are natives.. go figure on that ... peeps around here ... dig them from gardens.. and sell them on the roadside ... i wish i had a ditchdriver.. and could mow them all down as i drive down the road ... unfortunately.. that is highly frowned upon ... lol you could probably leave this one on the driveway.. with no water for the rest of the summer.. and it will prosper ... it does not need fert.. as they grow in my mineral sand w/o either, like weeds .. and it should.. most likely.. be allowed to go dormant in winter .... compare yours to google images, especially in regard to actual color ... ken ps: probably sown by the bird who keeps landing on your pungens leaders and killing them ... see the vicious web we weave ...

I'm not an expert, so you will have to google it unless someone else chimes in. But those are aerial burr knots which m111 are prone to grow. My trees are 10 years old and they have outgrown them, I.e., it has not been an issue. No pun intended. I did have to battle knot borers but the latex paint wash at the base helped. It is less of an issue now as the trunks are bigger

As stated above if the current owner hates it, they will do as they want, but As far as removing things that have grown into the tree's one branch or 2. The tree has dealt with it years ago. Trees have encapsulated bicycles, ropes and who knows what else, the main trunk is most important and they could likely deal with that stuff. If the owner got rid of the trees canopy above and saved the fern, the fern would die without that canopy ( I strongly believe) that the ferns ( because most ferns need shade) would die. If I were the owner I would maybe water deeply infrequently, but, you don't want to change things too drastically. I would've never thought a Southern Mag w/ Staghorn fern would be in a dry area in Cali. That's rare. I saw one large Staghorn fern in my life in Florida. It was in a large container on a tree trunk. It had some sun, but, most ferns, I have about 6-8 and they all want shade, so I would not get rid of that canopy and plan on keeping that Stag, fern. Plus that tree is very nice and rare, but, it's the owners choice overall. There have been pics years ago posted of bikes and other weird things leant against trees and never moved, and the trees just grew around these things. The trees will never be harmed by these objects unless someone tries to take them out. Maybe a rope for a swing only partially grown into the tree then used by a heavy adult would be worrisome. But, well, lets hope that wont happen.

That does not look good and is possibly some type of boring insect that is causing havoc. If I were you, I'd take a pocketknife and carefully lift and remove the dead bark from that sunken area to better see what's going on there.