First 741 rebuild with pics of pattern

Pinion's too deep. Backlash is the checking measurement. If you have the depth and preload right, the backlash will fall in perfect every time. If you have to go too tight, there's a problem. I'd lose .004" from the pinion and recheck. Also, 25 inch pounds rotating torque is with the seal in place. Without it should be closer to 15.