I am gatering that you are using the stock flywheel is this correct? I also was using the stock flywheel and also turned a prop hub and threaded it in the lathe so i know the threads were straight. to my horror also it had some runout when installed on the engine.

After looking at it for a long time i realized that when the flywheel was chucked up in the lathe and the fins where cleaned off that it was impossible to chuck up the flywheel and face it off to where the facing was perfectly purpendicular to the shaft centerline. so when put on the engine and the hub installed and if there is a little slop in the threads the hub will fit itself to the flywheel face that is off just a little.

Ok so to fix this i took a spare crank i had that i didnt plan on using at all. I knocked the shaft off of the counterweight as its just pressed on. when the flywheel is installed on the shaft I now have an arbor that i can chuck up in the lathe and use this to turn the flywheel perfectly prependicular to the shaft.

Just one problem. when it is installed on the shaft you cannot face the flywheel where the prop hub goes because the nut holding it together is in the way. SO the thing to do is leave enough room between the back of the flywheel and the chuck when it is chucked up that the back side of the flywheel may be faced off. this cleaned up surface on the back sidde of the flywheel will now be purpendicular to the the shaft centerline and now you will be able to take the shaft off and mount it in the chuck chucking off of the outside of the flywheel. The new concentric back of the flywheel will rest against the chuck dog face and if your chuck is in good shape and concentric it should maintain the perpendicular plane to the shaft center line. the flywheel may now be faced and shound have a facing that is perpendicular to the shaft center line

this is what i did and it did fix my runout.