‘71 340 Duster Front Drum to Disk with Factory 14” Rallye Wheels - Problems

Using your suggestion to test adequate clearance with flat washers as spacers, it requires 3/8” of washers on each stud to completely clear the caliper. I am simply not comfortable with that thick of a wheel spacer. This kit is advertised to fit!

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Have you tried loosening the caliper bracket bolts to see if they'll slide inward any?

As far as "they're supposed to fit" goes, it's called tolerance stack. A little extra on that set of calipers, maybe a smidge on the caliper brackets, maybe those wheels were a bit smaller than advertised. It happens. I'm sure that combo is in fact just fine on other cars. That being said, the rallye wheels in particular have a history of not fitting with certain brake combinations.

I'd grind a little on the calipers and not worry about it. But a 3/8" hub centric spacer wouldn't hurt anything at all. Might require longer studs for proper engagement thread though.