I dont think its squeaking due to the belt, as now after putting another belt on, it still squeaks.

Im gonna swap the pulleys tomorrow and see if it solves it. If not back to oreillys to get a replacement ordered in.

on a side note, given that the 7 groove pulley and the 6 groove pulley have the same spacings between grooves, and the only difference is being a bit wider for the extra groove, Should i have any issues running the 7 groove pulley, with the 6 groove belt (since the rest of my system will still be a 6 groove)

 

should be no problem running a 7 groove pulley on a 6 groove setup. I've been running a 6 rib belt on my 7 groove pulleys for years. The only reason I'm doing it is because I put on an underdrive kit and the only belt I could find at the local parts store that was the correct length was a 6 rib (nothing in a 7 rib that was close). It was meant to be temporary but I haven't had any trouble out of it so I will wait until the belt needs to be replaced and then try to find the proper 7 rib.