The needle bearing is just to support the axle shaft, it should be sound but is not the wheel bearing. The big bearings inside the hub should rotate freely and not feel "rough" when rotated nor should they make any kind of a noise.
The spindle should be held on with bolts and once they are removed it should come off. It may need a bit of help by placing a block of wood on the spindle and hitting the wood hard with a big hammer. Do this down, sideways and up. If that doesn`t work you may have to rent a spindle puller to get it off.
The steering knuckle is attached to the axle by two ball joints. To get it off you need to remove the nuts from the ball joints and then drive a pickle fork type ball joint remover tool in between the knuckle and axle flanges to "break" the taper joint apart.
However unless you are fitting new ball joints you should not need the steering knuckle off.