Afmcorp, Don said he adjusted to 0.01-0.02 mm, which is in the 0.0005" range. I think he used the proper indicator and read it correctly.

But I agree with your comment on the dial indicator setup. I took a second look at Don's picture. The base should be on the bearing hub flanged face, not the rotor. There's too much potential for false play that he'll be detecting. I'll assume the dial pointer is properly sitting on the end face of the spindle shaft.

__________________
95 E320 Cabriolet, 159K