So I put my kyb forks in the clamps on the first line. I put the axle in to make sure it's free and not bound up. When I tap a fork to get the axle absolutely free as possible, the forks are noticably different heights in my opinion. When I make them exactly even, the axle will spin but not quite as freely.
Which do I settle on: free as possible axle or perfectly even forks? Thanks 

I use the lines 100%….
I made the lines even and went with it lol
I go with the axle being completely free. Spin your front wheel and look for wobble when deciding between the two
What you're showing is not much difference in height and nothing to worry about. Put the forks at the same height. There's no reason to make the axle free at the expense of different fork heights (and therefore different bottom-out position, different stiffness on each leg, different adjustment height for rake, etc.).
If the fork heights are dramatically different to get the axle to fit freely (like 5x that amount), then something is wrong internally in the forks and you should have them checked.
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I constantly monitor the fork heights on my Ktm”s, even though I”m at or slightly higher than standard torque settings, the forks always slip a little within the clamps…I also adjust fork height for the different tracks I ride…
Remove the shine from the anodize inside the fork tube bores on the clamps with some sandpaper and they'll grip the tubes a lot better. You don't have to completely remove the anodize, just scuff it up.
That's the right thing to do.
Coil springs can vary in manufacturing and two springs with the same part number from the same manufacturer will have slightly different lengths.
You have three coil springs inside each KYB fork that determine the extended length of the complete assembly:
1) Main fork spring
2) Top-out spring (inside the cartridge seal head)
3) Pressure spring (Inside the compression / base valve assembly).
The main fork spring and pressure spring are opposed by the top-out spring when the fork is fully extended.
Small differences in those springs can cause small, insignificant differences in fork length.
Also, the volume of oil in the cartridge after the bleeding process can cause one fork leg to seem shorter than the other.
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