Is it possible that the lower arm of the transfer lever is too long? It is hard to tell from the photos provided, but if the top left corner of the side plate is very square and not rounded over it is an early model (1900) side plate. The lower arm of an early model transfer lever is much shorter than a new model. So if you have a new model transfer lever in an old model side plate it might produce what you are seeing.
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If it's made after 1918...it's a reproduction
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