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Remove the clip and grind a little bit of material off of it. I had the same problem as you.
Hmmm, I just replaced the slave cyl on a Navajo. the old line won't go in the new Perfection unit. Seems like that clip is what's preventing the connection. It's digging in to the bevel on the aluminum insert.
So, that clip will come out and go back in with the tranny in place?