I pulled the clutch lever and it did have some up and down wiggle to it.
I took the entire thing out because I remembered reading a thread about the hole it pivots on becoming oval... but mine was perfectly round.
Is a little up and down wiggle normal? Can you over tighten the clutch lever when installing it?
A little is OK. Question is what'sa little? I like nice firm controls. You checked the ovalarity of the hole, good. The good levers will have a bushing in the hole, usually brass or bronze. And you should be able to tighten down the perch to limit the flop. Though that aspect is also controlled by the shoulder on the pinch bolt. So less flop comes from a lever that fills the space.
Regardless, while you may want a nicer lever, that's not your problem. My money is on that washer. APE and the ilk have made and used those clutch discs in the thousands, maybe tens of thousands. And other people have mixed and matched clutch plates for untold purposes. And yet the clutches always worked.
I mentioned in an earlier post it sounded like something was missing, I thought in the lifter. Again, my money is now on the washer.