redracer
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Disco--not good. There is something amiss inside your auxiliary oil pump housing. Almost sounds like the rear circlip holding the rotor on is moissing, plus the 1/4"movement is not good for the timing belt. Unless there is something obvious externally that is not bolted down, you would be best advised to remove the assembly and investigate(ruined engine:$$$$$$$$$$).
While you have it out, shim the pressure relief valve up to 6mm(use shims/washers behind the spring) for the 10psi/1000rpm standard(they sey it originally at 55 psi--too low)
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