Yours seem to be installed correctly, if it is sitting loose in the lever, you may need to peen around the hole alittle. What are you running for clearance when the clutch is engaged? Really should not be enough clearance that the button can get out of the lever. There is a spec just don't re-call it off the top of my head.
Maybe I mis-understood your opening comment, If you are thinking the small "nub" you are seeing should be flush, no it is fine, you want the large diameter to sit back against the lever.
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Gary
1974 1650 50A "budscub" Was my fathers
1969 125 42"
1978 1450 44A dual hydraulics
1984 782 50C dual hydraulics, waiting for vanguard
Z-force Cub cadet Zero turn
Sears '66 Suburban 10 Sears '66 Suburban 12
2 Breaking plows, 2 disc's, front blade, rear blade, Sickle bar mower, 2 decks 3pt harrow
74 "Green 100 "John" 
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