You are more than justified on being upset. I have no experience with the larger shank so will let the vets weight in.
I believe the inletting he is talking about is FORWARD toward the barrel to allow the thicker lug to sit in the stock (I am seeing the same thing on my 111 and chewing on ways to go about it. Its not load bearing but I want as neat as possible.
The back part of the opening that the lug is up against should not change. There might be a bit of work around the upper arc in contact with stock, that's probably dremel tool if needed.
Smith should have the tolls on hand to do that.
At this point I am looking to see if I have an old fine tooth straight blade that I can cut to wright width for my Fine Vibrating tool to open that up.
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