Back when 3 wire feeders were permitted a "Sub Panel" was treated the same as the "Service Panel" at your residence. At the Sub Panel the Neutral and ground were bonded at the panel and a ground rod was installed at the Sub Panel location. So to get this back the way it was probably originally wired then from the 3 wire feeder connect the Blk & Red wires to your "Hot Lugs" at the Sub Panel as they were intended to be your Hot wires. Connect the Neutral wire from the feed to Bus bar and "bond" the Bus Bar to the casing of the Sub Panel. This is commonly done with a "Green Screw" that are supplied with the Panels. You may need to go purchase one. The bare copper ground coming from the conduit is already connect to the panel so after installing the Green Screw you could just leave it where it's at or move it to the Bus Bar. You will also want to drive a Ground Rod at the Sub Panel and connect it to to Bus Bar. That's how it was originally intended.

or you can run a Ground from the Service Panel to the Sub Panel and not put a Green Screw (not Bond the Sub Panel) and keep all Neutrals and Grounds Separate but still add the Ground Rod.

But if it was me, I would just redo it and use a 4 wire feeder and bring it all up to current Code, as there are several things that need to be changed. If not and something happens your SOL especially if a non Licensees person touches it.

I don't think I could be talked into hooking that up any way but 120v.

Either way is fine but as said if it was me I'd just update. Not that hard to do but if he's unsure then yeah it's wallet time.

I have a small ac unit i run a few hours on the weekend, a couple inside lights and I don’t run more than one tool at a time. Hopefully 120 is enough. But I don’t touch any of the wiring without flipping off the breaker inside.

I mean to say everything is running on a 30 amp breaker. It’s fed from a double switch 50 amp breaker with one hot wire. Maybe I need to switch to a 20-25 breaker?

just remember, the breakers only job is to keep the wire from over amping and melting, so breaker size is determined by wire size and type. Also, I can't tell what size the wire leaving the panel is But hopefully its #10 since its hooked up on 30 amp breaker. The problem is gonna be the wire size on down the line, so you're right about possibly reducing breaker size in sub panel.

I would also see what size the wire is coming from breaker to that sub panel and make sure breaker feeding sub panel is the right size (not exceeding wire amperage rating). Just a guess, but it looks about right size and type, due to the fact that its stranded ( will handle more amps). I would hook it up to a single pole breaker (from feeding panel) as well. I don't know if code requires that or not, but like i said. I like for my electrical to be perfect. But its hard to say without looking at the whole thing.

And room for red wasps to get in there.