So I've got my tailstock adjuster working and it's a great deal easier to get some kind of alignment. things still move around by a thou or so when I tighten up, but I can deal with that with just a little bit more patience.
However, whilst testing the alignment (with a dial test indicator in the chuck and indicating the tailstock barrel). I got what seemed a particularly high vertical error.
If I zeroed the dial test indicator and the top of the rotation, the bottom of the rotation appeared to be about 1 mm higher than it should if the tailstock was centred. Which I think means that the tailstock centre is .5 mm or so higher than the headstock centre.
I've read that 5 thou or so is normal (.125 mm), but this seemed excessive.
Doubting my figures I took the following pictures with a USB microscope – I had to rotate it in the computer to make it easier to measure.

The rule behind is in 1mm increments and measuring the relative heights I get the tailstock centre to be .6mm above the headstock one.
In some ways this doesn't surprise me since, even when I have the tailstock aligned quite well horizontally, there is a noticeable wander at first when a centre drill is used and there is some scraping (on what appeared to be the top of the hole) when it is withdrawn.
First of all – does this make sense from a measurement perspective – it seems to hang together, but I could be missing something.
Next, should I worry? I've mentioned the centre drill not apparently centering. If I apply some Pythagoras, .6mm out in height on an 8mm bar should only create a 0.025 (one thou) diameter error between the tailstock and headstock (less for larger diameters). I dream of such accuracy! Of course it all adds up . Having this much vertical error also makes it a little harder to see the horizontal error.
And finally, what should I do? the obvious thing to do is to mill off 0.5 (or so) of the tailstock to bring them level (or with the tailstock just a little higher).
I would mill the top surface of the base (as seen in the photo below) which should be relatively safe, though I may need to take a little of the channel that sits on it too, I would imagine that the base is available as a spare if I mess it up.

Looking forward to your usual helpful responses!
Iain