It almost seems the fender edge needs to go inside the fender tip in order for the top of the tip to sit flush against the fender. Anyone?

You figured it out.
If you doing the rear fender too I'll bet you need to elongate the initial holes you drill.
I'm sure you know, but a small block of wood fairs well to keep the drill bit out of the front tire.
P.S. Those were the first chrome goodies I installed way back in '97.