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Jim,
I just read this a few minutes ago. It looks to me like the conical portion of the balance staff is pushing up into the jewel. This is probably what cracked the jewel in the first place. As you tighten the plate, the cone of the staff is getting squeezed against the jewel face. Since the staff is easier to machine than the jewel, you will probably have to turn the cone back a few thousandths of and inch so it will fit. To gauge how far to cut the cone back, put some shim stock under the plate and tighten it down, If the balance will now turn when tightened with the shims, then the thickness of the shims will tell you how far to machine the cone back in order to make it work.
David Pierce