Wes, I drew some pictures to help clarify. The T5 usually needs a spacer if you keep the original 14 spline shaft because the splines are not cut long enough to allow proper clutch disc travel. The spacer moves the entire T5 back further and that functionally adds a bit of extra room for the clutch disc to travel away from the flywheel.
In my drawings, distance A must be a few millimeters less than distance B. Measure distance A with the spacer plate on the T5. Or measure distance B with the spacer plate on the face of the bell. One or the other, but not both.
If A is less than B you should be able to make the clutch disc release.
If your bell has an inspection cover, then another way to check all of this is the remove the pressure plate from the flywheel and bolt the T5 and spacer plate to the bell with the clutch disc on the shaft. If you can slide the clutch disc along the shaft away from the flywheel enough to see daylight pass between the disc and flywheel, then it’s all good.
