that happened to me a couple months ago changing my neighbors 67 over to electronic ignition. Needless to say I was not pleased the next couple hours.

 

hypothetically speaking. if it popped up out of its spot. do you think the dizzy is getting wedged in by the shaft...so thats why it wont drop further than just getting over the tip of the pump driveshaft?

 

the clip is made in a way that allows it to be pushed down, but not supposed to be able to come up. plus if the shaft wasn't seated in the pump, you'd know it, cuz it would probably be in your pan.

 

if you are using the same parts that were previously installed then the issue is solely needing to line up the shaft with the hex on the dizzy, sometimes it takes me numerous attempts when it gets out of align

 

try adding a little black silicone to the end of the shaft and installing it in the distributor. Let it sit a few minutes so it will hold, then install the shaft using the distributor. The balancer should be at 0 degrees.

 

TDC on the COMPRESSION stroke on #1 cylinder.
if you dont have it on compression: it probably will not start and you will smell fuel in the exhaust.
been there done that, same with the shaft... took the advise of taking the retainer clip off... the BEST thing to do is drop the pan and the oil pump and put a shaft in with a clip and put the oil pump back on. If you drop the shaft, you will be doing just that.
I used wheel bearing grease to create a suction on the shaft in the dizzy, silicone should work too like someone mentioned. take your time.

 

did u try rotating the rotor my hand while pushing the dizzy down? its a helical gear

 

^you'ze not listen'n. its doesnt even make it as far as the gears touching. it just barely gets the base of the dizzy of the tip of the oill pump drive shaft. somethign is holding it up.

 

lol oh sry there was a lot to read so i skimmed my way through

 

Did you ever get it to go in? did you pull the shaft and try it? Will the base of the dizzy even start going in?