Are we talking about ball bearings or roller bearings here? You've got the procedure right for ball bearings, snug the nut, spin the wheel, then back off about one slot on the castle nut. I don't really like to see any noticeable play or wobble, but a little is OK. On tapered roller bearings, snug the nut firmly, spin the wheel, then back off until the nut turns free. THEN, tighten the nut slightly, maybe 12-15 inch/lbs. Hopefully, a cotter pin hole will line up, since most spindles for roller bearings have two holes in them 90 degrees apart. Roller bearings work much better when they're slightly pre-loaded, especially if disc brakes are involved. I've cured problems with brake shudder and wheel shimmy on roller-bearing front wheels by simply increasing the preload a little.
Jerry

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