After talking with Wayne Brewer and measuring the diameter of the flywheel he thinks it should be good. Does make sense when it is the correct diameter.
Compared the starter to another one that has been working in another engine. SAME.
So it has to be a problem with the bell housing position. Maybe no dowel pins or maybe offsets. Will pull it tonight.
After all this I went ahead and took the transmission in to have it gone through. Eventhough the seller told me it was rebuilt it was leaking out of the bottom shift lever. Really can't trust anything at this point.