Mounting Mitutoyou DRO Scale

I bought a used Mitutoyo DRO and am having difficulty getting the scale's reader head mounted correctly.

The instructions say that the reader head should be located 0.040" from the surface on which the scale is mounted. Briefly, at 0.036" the head doesn't read, but if it's farther away it reads fine.

In more detail: The scale is mounted to the front of the mill table on blocks that are 0.912" thick, so the scale is 0.912" from the table's front. The reader head is mounted on an adapter on the saddle. The distance from the reader head's mounting surface to the table is 0.998". The difference 0.998-0.912=0.086 is the distance of the reader head to the scale's mounting surface (the blocks on which the scale is mounted) . This is 0.046" too much. With the head mounted this far out of spec, the scale reads fine. If I add a 0.050" shim between the scale and it's mounting blocks, which reduces the head distance to 0.036" (almost in perfect spec) the scale doesn't read. In both scenarios, the reader head was located the correct distance from the bottom surface of the scale (0.059") Some photos of the setup are below.

Why is this happening? What would you do to correct this?

It's used.. maybe reader lens is slightly twisted/out of focus..

If it works and reads properly, for full length of travel at wider/offset gap, use it.