Can a T1/E1 card p/n 550.2740 from 1997 be upgraded with the 827.8877 PRI Security PAL? What to look for on the older card to see if and where the PAL can be connected?

You can use the 827.8877 PRI chip on the T1/E1 card but not on the even older T1C cards. Those would require a PRI Daughter board.

Here is a picture where the chip would go on the T1/E1 card with the front of the card being to the left.