I have never used a dial indicator to find TDC on any engine I have ever built ... automotive, model, etc. It simply isn't accurate enough. I use the "positive stop" method. They sell special tools for this but you don't have to spend the money. For a backyard / basement method of doing this, you can take an old spark plug and break out the center. Either solder or weld a short piece of metal in the center of the plug (I use 1/4" brass rod) .... long enough to contact the piston (when this plug is inserted in the cylinder) just before (20 degrees or so) it reaches TDC, Using your degree wheel, rotate the crank one way until the piston just contacts the piston stop we made. Note the reading on the wheel. Then rotate the crank in the other direction until the piston contacts the stop. Note reading on wheel. Find the reading on the wheel exactly half way between the prev readings and you have TDC.

This method removes any stacked tolerances and piston dwell you would note at TDC trying to measure it with a dial indicator. It is extremely quick to do .... far easier than trying to describe it here in words. The "rock and guess method" is just about as accurate as a dial indicator for this application. The positive stop is dead nuts on every time.