I believe .035 to an absolute max of .040 is very good quench & people have gone lower (tighter) especially with steel rods like you have with reasonable RPM limits like you plan. I have found gasket compressed stated distances to be inaccurate & to me it is worth it to waste a gasket to find out for sure. also a piston can rock some depending on piston to wall clearance. I would confirm your measurements & milling some of the pistons and milling the deck is an option.