Trouble Installing Distributor

[Yabo]

I am having trouble installing my distributor (I think!)

Here is what I did:

1. Rotate the engine to TDC (verified compression stroke with thumb on plug hole, felt air coming out just before tdc)
2. With a screwdriver, rotated oil pump (inside the dist shaft hole) to angle roughly as factory manual shows.
3. Install distributor with rotor pointing approx 30 deg past cylinder 1 plug lead on cap
4. Push distrubutor downa nd rotor turns as the splines engage
5. Would not seat all the way (not engaging oil pump slot) so as the manual says, I applied downward pressure while turning the engine slowly until it drops in.

I tried 5 or 6 times, and every time it seems I end up halfway between 1 and 8 or 1 and 2 plug leads, never directly at 1. I am exactly at tdc by the marking on the crank pulley. It seems one tooth either way always puts me closer to 2 or 8 leads... Am I doing something wrong? Or is this closeness what it is supposed to be? If so, which side?

Thanks for any help.. want to see if this runs before I go to school sunday!