I was able to hold the 1.626 ID to be a slip fit with the spindle nose. I mic’s my spindle nose and it was at about 1.6255”. I had the part dialed in a 4 jaw within half a thou, threaded the OD, bored the ID, and tapered bore in the same setup. Pin in the collet was reading 2 tenths TIR.Have you tried mounting it up with a collet and a pin to check run out?
The concentricity of the ID bore and the tapered bore will have a BIG impact on total run out, the fit of the ID to the spindle nose will also have a large impact on run out. Mine is a fairly tight fit to the spindle. They are either matched sets or both made to very tight tolerance.
There are times when that ring gets pretty tight, especially if it is locked down for several months at a time. You may want to revisit that knurl to a coarser pitch and deeper imprint.
Looking closely at the spindle taper where the collet seats there is no damage whatsoever, very clean.Take a look at the inside of the spindle for signs that someone may have spun a collet in the past and made a ridge or other damage. Mine has always been to just toss the collet into the cap and slap it in place and it has never done anything but center perfect. it never mattered how crooked it was dropped in. I have even tried to get it off center just to see if it would and it would not go off center even when trying.