What usually happens is the crew doing the walkaround spots something that looks like damage, calls airline maintenance, and techs come look at it. For a ding, they will consult the Structural Repair Manual guidance on allowable limits on dents. Based on the SRM it may be ok to leave as is, or require repair, or require further evaluation.
If the SRM doesn't cover it, or not all the eventualities, they will call the OEM's product support organization for an assessment, repair scheme, and a temporary "fly-by" (a fix deadline) if feasible. A really big airline may have its own internal structural engineering team with its own design approval authority up to some level of severity, in which case it's all done in-house. Smaller airlines will call the OEM and pay the OEM for its engineering services.
In any case if it's outside the SRM limits, somebody somewhere with authority has to review the dent and decide what to do.
We don't really know what was done in the case you saw, so I'll speculate that the "ball of steel wool" you saw was actually the dent but looking like a bump due to lighting, and the area was probably roughened with Scotchbrite or something similar during the inspection, creating a steel wool look. There could have been a Non-destructive Test done (usually dye penetrant) to look for cracks in the surface where the metal was bent, which would make the surface look different from the surrounding area with the treatment process. Also if there were sharp defects like a gouge, there was probably some "blending" of the local material to minimize the stress riser effect of the gouge and the blending with emery cloth (sandpaper) would certainly leave a steel wool look to the area.