The exhaust manifold is now a quarter inch smaller?

Dudes, I bolted up my share of Chebby small block exhausts and don’t remember ever getting one that was off by that much.

But, generally with everything on those cars (chassis, body panels, suspension bits, etc. etc.), I always had better luck starting the end bolts first, just a couple threads, then working it in. Sometimes even had to use too-long bolts to start and then switch them out.

Is this an iron manifold?

Wow,, this is a good one.  first, is the  gasket wright ? did you try it with out the gasket , I did the head on mine this fall I put it all back together off the block , that made it a lot easier to do the intake . if you used the same manifold , i don’t see why it would not just bolt up!..  Dan R

At this point Sherlock would have said Aha! Your two problems could be related. Real likely that someone broke a bolt in that hole and drilled it out off center. Then repaired that with a helicoil, again somewhat off-center. Then forced the bolt in and screwed everything up. If that is true, then I would drill an oversized hole in the manifold and use a grade 8 washer under the bolt head.
If it is a helicoil, I would not try and drill it out since it is harder than the cast iron around it. A Helicoil is just a spring with sharp edges in the shape of threads. You should be able to see the start of the coil if you look real close, maybe with a magnifying glass. Try using a dental pick to get the coil way from the grooves. Then use needle point pliers to unscrew the coil.