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yes,1/8 travel seems far too much.perhaps using a spacer
position those pistons further out and re assemble?

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Spacer???
Maybe your forgetting how a disc brake caliper work
If your pistons are retracting 1/8" that's way to far.
Like I stated before the seals are pulling the pistons back to far.
They should only retract far enough to let the rotor spin without touching.