Pull the bolt and try it. That will tell you if part of your resistance is the bolt going in. I'm pretty sure you experience a bit of that and as you run the bolt-less BCG in you will feel the tube rub or not. If it is rubbing a judicious application of a screwdriver to push the tube back into alignment, that would be bending it LOL, so it slides smoothly into the key hole. This problem is often overlooked by builders.
The best firearm for self defense? Any loaded one will do.
My gut feeling tells me there's something amiss in the barrel mating with the upper receiver. A slip-fit of the barrel into the receiver (with no wobble/play) can be compensated for using blue loctite as a bedding compound. If the fit is loose enough that you can wobble the barrel with the extension in the receiver, then you might be able to correct it with a metal shim McGuyvered from a $6 set of feeler gauges from your local auto parts store. I just did that on one of my uppers. I slipped a 0.004" feeler strip, trimmed to match the extension's circumference, between the extension and receiver body with a little blue loctite to keep the strip in place after assembly. Worked like a charm and made for a solid fit of the barrel in the receiver. I picked that concept up from the AR15.com forum. However, make sure your receiver's opening is within spec (not sure what the max bore diameter is for the opening on the receiver). If it's way off, I'd replace the upper receiver.
The other culprit might be a lack of squareness of the receiver face, as noted previously. It's definitely worth a tear-down to true up the receiver face and check the soundness of fit of the extension in the receiver. 2+ MOA with quality ammo seems to be a mechanical issue of "great magnitude", in my mind. And the receiver-barrel mating is a worthy suspect to investigate. Hope you get it sorted out soon...
Well bad news 4 people shot this gun and the one I was waiting for made it Sunday afternoon, he is an excellent shot does a lot of long range shooting. He would shoot an occasional 1 in group and then 1 1/2 to 2 inch groups nothing predictable at all. I have returned the upper to have a new barrel. The Black Hole barrel will be returned for a refund. I do appreciate the help.
I'm curious what scope mount that is? I'm personally a little leery of quick detach unless it's really high end. Also it appears that your scope is mounted very far back, which is opposite of how most use cantilever scope mounts.
Not being critical at all, just maybe a couple of things that hadn't been considered yet. The gas tube looks ok to me from what I can tell.