Aye XTFraz,
By the reading of your mail, you are not pushing the rod to the side squarely. To make an accurate measurement, the rod needs to be moved to the side squarely and the gap then measured.
Therefore, your side float gap with the rod on the sosh and from measuring the widest part of the gap, it would appear that you are within the tolerances in the manual. This is good, but you are measuring the gap using a different method from that assumed by the manual writer. Not always good, if you see what I mean!
Pedantic, I know, but it can cause grief. Literally.
I hope the rebuild goes well and the engine lasts for many more miles.
Regards, Bill.