[zzmac]

Progress! I cleaned everything and shortened the bolts by maybe 1/8". I put everything back together without the thermostat and without any sealant and NO leak. So I can only presume that the thermostat slipped or the bolt(s) were bottoming out. Thanks everyone for your help and suggestions!
I haven't started the engine but I'm hoping it's ok now. When I redo everything and put the thermostat back in would it be ok to put a tiny bit of silicone around the edge of the thermostat to help keep it in place?