Clutch Z-bar alignment

[Detour]

When I bought the truck the previous owner claimed his son replaced the clutch and forgot to put the "ball" back on the linkage. I had to bury the pedal in the floor to stop or shift. Tough drive home... As part of the bigger project I ordered new ball studs from LMC and finally got around to installing them this weekend.
Now the Z-rod was at a very steep angle before and was rubbing through the frame.. or someone had clearanced it for the steep angle. After pulling it out I found that both sides had the ball studs, but someone had re-welded the frame side arm and melted the nylon bushings inside the tube. After scraping that all out and installing the new parts I found that the Z-bar will not fit. I even chiseled out the rivets on the frame bracket to see if that would help me get it aligned.
In order to get both ball studs seated properly and close to level I would need to raise the engine side ball stud up 1.5"(+/-).
Does anyone have any advice on what is going on here?
Pictures do not have the engine ball stud installed. The previous stud was in the hole below the oil dipstick tube (removed because it broke). Engine mounts are intact and do not appear damaged.
67 'K20, 327, SM420, Z-bar is 7-1/4" long.