Z bar alignment
The bellhousing may be causing you issues. What's between the ball stud and the inner fender? In your picture you can see the ball stud ends at the red arrow. The yellow arrow is pointing to some kind of spacer? Shouldn't be anything there, the ball stud should bolt straight to the inner fender. There are two different lengths of Z-bar for the small block bellhousings that I know about, one is an inch or so longer than the other. Could be the Z-bar isn't the right one for that lakewood bell and it was "adapted".
The bellhousing may be causing you issues. What's between the ball stud and the inner fender? In your picture you can see the ball stud ends at the red arrow. The yellow arrow is pointing to some kind of spacer? Shouldn't be anything there, the ball stud should bolt straight to the inner fender. There are two different lengths of Z-bar for the small block bellhousings that I know about, one is an inch or so longer than the other. Could be the Z-bar isn't the right one for that lakewood bell and it was "adapted".