Agreed.
At first I thought it looked ok but a little suspicious, and now that coast pattern looks too concentrated in one area.
Also it does seem like the contact area is too close to the edge of the gear teeth. (wondering now if that was what caused the chipped pinion tooth)
Before I just thought someone might have tried to use a chisle to remove an old bearing race.
Correct me if I am wrong, but it looks like the ring gear needs to be a little farther away and the pinion in closer to the carrier.
Or do I have that backwards?