Front wheel rubbing issue (kz400D)

[Architecterre]

New to motorcycles, rebuilding a 1976 kz400D from the ground up without much former experience so the answer may be more apparent than I realize. I've installed Brand new wheel bearings, seals, speedometer drive gear, brake pads, spokes, etc. When resembling the front end I find that if I tighten the axle nut as tight as I can, the rotor rubs the brake pads slightly. The brakes are currently fluid free and have not been bled. Beyond that issue, the side with the speedometer hub rubs slightly and does not allow the wheel to spin as freely as it should. I think this is because of the new rubber seal I've installed. I've also noticed that I have a spacer on my axle between the speedometer and lower fork leg that does not exist on the schematic diagram of the front wheel and axle found in the manual. I have also noticed that the manual has another error, showing that the speedometer drive gear goes infront of the wheel seal instead of behind.

left side with spacer:

right side:

brake setup:

More images here:
http://s1204.photobucket.com/user/Adamh4218/library/?sort=6&page=1

 

[Architecterre]

My concern is from looking at photos like this:

compared to me:

yet if i remove the spacer, I cannot move the wheel/speedo hub over as they are being held in place by the caliper so the spacer seems to make sense in my case...

 

[Nebr_Rex]

For the stock 400 the spacer goes on the other side.I need a pic of the axle area of the
fork. Either side will work. I'm thinking you may have 440 forks. There should be a threaded
hole on the back side of the fork for the fender brace. On the close up pic of the rotor side
it looks like it's in front. Back in the 70s the factories moved the calipers from the front
to improve handling. If someone has replaced the stock forks for 440 units I would swap
the forks side to side and mount the caliper on the rear, which is what I do in normal practice.
If so, you should source a different caliper so the bleed screw would be in the correct location.

.