Sure it is cold out now and you would not have had the AC on, but I would be willing to bet you had your defroster on when you smelled the clutch burning. The compressor clutch is energized when the defroser is on. If you energize the AC clutch with a locked up compressor, the symptom is exactly as you describe. I know this from experience with my 2000 XJ. The compressor pully free-wheels when the clutch is off. If the bearing is binding, it will not cause the clutch surfaces to rub and thow metal, it will just be noisy. The bearing is sealed. You can't lube it and fix anything.
The failure mode is the clutch gets very hot, not from an electrical short, but from the heat of the energized clutch plates slipping. This heat melts the inuslation on the wire inside the coil. That causes the windings to short together or to the case of the clutch. This is often followed by a blown fuse.
If you want to drive it, turn off the defroster and you should be OK. Better yet, open the power distribution box and remove the 25 Amp fuse for the clutch so it can't be truned on.
Don't waste your money on a rebuilt compressor or replacing the clutch alone. Go to one of the discout Jeep parts sources which have been covered here and buy a new compressor which includes the clutch. I bought mine new at jeepsareus.com for $50 more than the clutch alone, which I had already wasted my money buying. Leave all the connections on the compressor until you have a new compressor in hand. You can move the old one to the side (hoses still connected) and bolt the new one in place. Then bleed off the pressure and swap the lines over quickly, and you should not get any moisture in the system.
Be careful when you unscrew the 4 bolts that hold the compressor to the mounting bracket. The bracket is aluminum and mine had a real bad case of dissimilar metal corrosion. I broke one bolt getting it out and had to do a helicoil repair.