In looking more closely at the Assembly picture, I've spotted something that may attribute to why that finger isn't locating into the switch!
There are two roller bushings opposite of the lever that should guide the edges of a cancelling plate. Currently that plate is resting on TOP of them! That much I think is solved... I'm anxious to get home now and correct that (I'm at work.. ahem).
I still don't know about the thin leftover strip though...
Jerry