I don't recall all the details, but a guy at my range brought in an old brass-framed Navy Colt for one of the rangemasters to look at - same deal, excessive cylinder gap.
He was able to "move" the slot on the arbor just enough to tighten up the barrel positioning - filled one end of the slot, then filed/milled out the other end. The wedge was just a little too tight, as I recall, & needed some stout strikes with a nylon hammer to disassemble it.
I saw the before & after fit & it did make a big difference. They used light loads of Pyrodex & it was a solid shooter, although it was just tight enough that after fouling crudded it up, he needed to brush it down with a stiff bristle brush to free up the cylinder turning.
"Hey Look! We've got Guns ... and We've got Snacks!"
- Cdr. Samuel "Sam" Axe, USN, (ret) -