Front Brake Caliper Overhaul (Update 09/2006):
The front brake calipers were rubbing all the time while I was driving even with the new pads after installing the new brake rotor.
I had over 50k miles and figured the seals may need replacing.
The brake caliper has two pistons that press on the brake pads when you engage the brake, each has two seals, a dust seal and an oil seal.
As I took it apart I noticed that one piston was not retracting when I released the brake which was making the pad rub against the rotor.
When I got ready to do this, I took off the front wheel and removed the caliper after draining the oil. Then took off the pads. Now the pistons where almost fully retracted. To remove them now, you have to use a compressed air nozzle thru the opening where the brake line connects. If I did it again, I would first take off the front wheel and then remove the pads. Then squeeze the brake lever to force the pistons out as far as they will go and . DO NOT PUSH THEM BACK IN. Drain the oil and take off the caliper. You may now be able to get the pistons off without using compressed air. Careful doing this. I didn't try this so don't know if the pistons will be pushed out all the way and you'll get brake fluid everywhere. To be safe you may want to leave in one or both pads when you force out the pistons and then try to work them out after removing the pads. Careful not to mark the piston surfaces.
This is the caliper without the pads.
This shows the pistons in place.
This shows the pistons removed. The right cylinder has the seals removed. Clean all parts with brake part cleaner.
This is the other half of the caliper. Make sure you grease the pins and rubber boots well before reassembly.
Honda sells a seal kit which has both seals for both pistons for about $11. Careful when taking the old seals out so you don't score the cylinder surfaces. Use some brake fluid on the new seals so they go in easier.
Reassemble everything and put back on the bike. You may also want to overhaul the reservoir and master cylinder while your at it.
After this overhaul, there was a marked improvement in brake performance and the noise was pretty much gone.