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Should the radiator (foam-type) seals on each side of a 78 L48 actually be touching the radiator or is a small gap (ability to see daylight between the seal & radiator tank) ok?
There should not be any gaps. Some of those seals are rectangular section (not square section) and must be oriented correctly so that no gaps are created.
I'm sure you got the 'clear instructions' with your seal kit...just like I did mine.... NOT!! A piece of paper that shows how to properly attach the seals would be nice.
That is what the AIM is helpful for,showing how they go in. Some parts catalogs show the mounting directions. Willcox corvette may have something on their HELP section.