Omega Geneve 136.0102 Casing Problem

I was given this Omega Geneve as an “If you can fix it you can have it” watch. Well I serviced and got it running great, but trying to case it up is a nightmare. The movement ring is putting too much pressure on the movement such that the stem can’t enter time setting position. I’ve flipped the spacer both ways with the same issue. Once the case back is remotely tight I lose stem control. I’ve enlarged the stem hole in the spacer to get some space there. It feels like the movement spacer or even the caseback itself is binding on the stem. Out of the case the keyless works is buttery smooth. I’m out of ideas.

Removed the wave spring out of the case back. Probably not the correct fix but problem solved all the same.