Don't sand anything. Don't modify anything. You will never get relief from vendor, if necessary.
1. Disc to pad spacing is very tight because there is no return spring like on shoes. The pressure is relaxed, that's all. IT'S NORMAL.
2. Rotor is a small diameter, not much leverage to overcome tight fit caused by things not settling in yet. When tire gets on, and you roll down the road, you will "loosen" the pads a hair more. As JoeH says. Jack up one wheel with tire on. Check spin. Let it down. Drive back and forth in driveway or down the road. Jack back up and check spin.
A normal new disc brake will have contact or near contact with rotor and pad. Contact is friction. Friction is resistance.
3. The fact you got it together proves you have the right parts. As JoeH says. Bench bleed may or may not be enough. May need system bleed also.
4. You say you can't get much help from vendor. You ignore the ENORMOUS help you are getting on Stovebolt. The vendor says "we don't know" this or that. We do know. What is your problem with taking our advice? What advice do you want?
5. Yes, we have much experience on here. Most of the responders have done a disc brake conversion or two. Most have replaced pads on a vehicle or two. Including me for both.
6. When a person asks for help, then does not answer questions and rejects the advice without any knowledge, as Jerry would say, I'm done.
