Most Chevy blocks have two bolt patterns under the block so you can mount the starter close for the 153 and far out for the 168. Yes, you MUST use the knurled bolts, because the starter can kick sideways under torque and break something like the block. Those bolts are special and must be used, and torqued tight.

Sounds like you need to add some shims to gain some clearance, as jmink said, a paperclip is about the right size to slide between the engaged gears to check for proper clearance.

Don