Rebuild...

The neck fit nice and tight into the dovetail joint. The picture here shows a mockup dry fit of the assembly. I wanted to check the action of the guitar before I glued it up. I strung the guitar and tuned it 440 and was blown away with what I found. There was no need to remove any material from the heel of the neck because the action was perfect.

Note that I'm using a 2 ft bar clamp to hold the heel of the neck tight against the side wall and the string tension to hold the top of the neck tight against the body. The fret board is protected from the two C-clamps with a small piece of wood cut to the width of the fret spacing. These small clamps were not only used to hold the tongue of the fretboard tight to the body, but also used to align proper positioning of the neck. I could move the headstock left and right and use the strings as a straight guide to properly align the neck to the body.