other than what you mention, the only other thing i can think of is the pinion itself... like i said - i was sent some .8 mod pinions, and they looked so close i didn't realise till i got hold of some proper mod1 pinions... They made the same grinding noise - you can hear and feel the gears 'clicking' off of each other...

Try what brian said - get a stand and move the spur slowly with ur hand - i usually hold a wheel and spin that slowly...