Engine Install Problem!

Can't stress enough about checking your bellhousing alignment, especially given your symptoms & the bell you are using. Installing or removing the bushing is really no big deal, I prefer using an old input shaft to verify fit rather than using the pilot tools. The bellhousing alignment basically insures the bellhousing & crank centerlines line up. If they don't line up a number of problems can occur including difficulty installing the trans. You need to mount a fixture to the flywheel & check the runout on the bellhousing hole using a dial indicator. Any service manual should tell you how to do this, its a PITA but must be done. One last thing, the bearing retainer MUST be a tight fit in the bellhousing hole for everything to work properly. Good luck!