Let's start over. You know you have a 292. What is it out of, a PASS CAR or TRUCK? What year?

You may have a parts mis-match

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Torquing the balancer too tightly will not cause this.  It's steel sandwiched between steel.  Nothing is going to compress by any measurable amount to cause this.

With it tight, check pulley alignment. Also check pulley width.  Early engines use 1/2" belts and later ones use 3/8" and the pulleys will be sized to match.  You can see the width difference in the picture Kultulz posted.  If the pulley is not aligned or the width does not match, then it could be the wrong balancer or it could have been altered for some reason in the past.
Make sure the damper is not hitting something on the outside of the engine, a bolt or stud that's too long a bracket, a tool you forgot about that's getting sandwiched, etc.


Lawrenceville, GA

Check for the damper hitting the timing cover.

So what inside dimensions - length should the harmonic balancer have for the 292? What is the proper 292 y-block harmonic balancer part number?  Maybe I have one from a 239 y-block.  Number on it is ECG 63 with the inside length of 3-21/64" which is 7/32" longer than the balancer shaft to the oil slinger.

6700 - SEAL
6310 - OIL SLINGER
6306 - CRANK TIMING GEAR

The only thing I can think of concerning a spacer is the thought of the seal flange being considered as a spacer? The seal was installed on the inside of the front cover?

CASTING ID NO, EDG (there are more characters) ID's the balancer. There is more than one balancer. It depends on model type and belt sheave nos. Full ID NOS may help to ID which one you have. 

Actual dimension specs are not given. I some instances, measurements are given in CATALOGING TEXT to help ID a part.

Wondering, when you torque the balancer bolt to spec, how is the clearances on the crank center thrust bearing?

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I ran into a similar situation latest year when I built the 292 in my TBird.  When I installed the front cover, it looked like the oil slinger would contact the back of the front cover.  I posted the photo below on the forum. When the damper is tightened down, it forces the slinger into the correct position and does not touch the cover.  There is no spacer in my motor.  The red goop is assembly lube.

For comparison, here’s a 239 spacer. The 239’s didn’t have a balancer,just a pulley. It was shorter so a spacer was needed.

  Dennis in Lititz PA