Firstly, Like everyone else here, I highly doubt Hunter put this in the wrong place, but strange things have happened . Hunter did put the jig for my water tank filer in the wrong place, drilled it through the deck even and then realized, filled with epoxy and attempted to redo the Deck pattern and made a bad job of it.. Fact, and in factory my boat.
Back to your problem
At the beginning you stated: the flange more or less fell off in your hand the key was worn etc. So this establishes one of two things for certainty.
Either the alignment was out before you started, or the nut on shaft came lose. You did not mention whether the flange bolts were wired and or tight, whether the shaft had its locking tab on the nut. If the nut holding the flange came lose even with good alignment, I would expect the results you saw. However if the alignment was out before you started I would expect the flange bolts would have suffered, ie would have been lose, perhaps elongated their wholes. I’m going to assume (tell me if Im wrong) the flange bolts seemed in order.
Hunter getting it wrong in the factory ( I cant say it is impossible given my earlier statement) but that and no one having found or fixed it before now I would say is my absolute last option..
In spite of matriculas effort and detail you have shown and I apologize for the suggestion but I would be going for a self-inflicted wound.
I am struggling to understand “But the side to side wasn't even close, it was off by 1/4" “
and “In this hole I slipped a laser tool for bore siting a rifle. If the laser is good enough to hit the bullseye” for strut alignment. I don’t doubt you, I just don’t understand why the bullseye was not also ¼; or more… out.
In my own case I doubt I could get that much out by adjustment if I wanted to, which is effectively what your experiencing in reverse.
If the alignment was out prior to disassembly by ¼” I would expect the ware on the cutlass to reflect something near or at least indicative, with the ware on one side for example. Was that visible. But if the nut came lose on the coupling I would not expect any specific directional ware.
Also “When I first removed the original mounts they were bedded with what I believe was 4200. I saw no evidence that the mounts had ever been moved from where the factory put them. I've looked hard.”
Again not doubting you, but I have trouble accepting it has been out ¼” or so badly from new. How many hours are on the engine?
Any idea how many miles it has done ?
Do you know why the survey said to replace the old mounts, do you still have them, could it be these are different somehow by ¼” It seems some engine mounts differ between front back port and starboard. I have no idea what yours should be, or the differences, and assume you put back new ones for what you had and the way you had, but that doesn’t mean they were right when you started of course.
Also “All the original shims under the mounts are in the right place” So I don’t know your setup, and yep different boat model etc, but do you know why there are shims there in the first place. My mounts are adjustable as I assume most if not all are and yours look to be also.
Apologies if I have missed something obvious.