I never encountered something like that.I would think the balancer itself would hit before the elastomer ring. Does it have a welded on timing tab or a bolt on one,if it is welded is it possible it is hitting were it is welded to the cover ? If you pull the balancer look to see if the oil slinger is behind the cover,the slinger goes between the front side of the lower timing gesr and the back side of the cover,it may be just thick enough to space the balancer away from the cover. Does it look to have more then 1 timing cover gasket on it or does it look as if the cover may be distorted in any way?