A little vertical play in the magazine is really neither here nor there, as long as the feed and barrel ramp angles are correct. When the magazine is full, the top round dives and hits the ramp farther down than when the magazine is at the mid-point. This is caused by the lack of cartridge support at the front on the top 2 rounds. So, how can a 32nd inch of vertical play in the magazine have any practical effect?
I have an unaltered GI Colt manufactured in early 1919 that has more than a 32nd inch, and it'll feed hollowpoints and SWC as readily as hardball...and it'll do it from the old "Hardball" magazines.
The 1911 was designed to function, and it was designed so as to allow for minor manufacturing glitches and fairly wide tolerances. If it's correctly built to spec and fed halfway decent ammunition from proper magazines, it will function. It doesn't have a choice. It's a machine.
LOL... Listen to this man he knows what he is talking about. IMHO it is not a feedramp issue or a vertical play issue. It is a magazine issue. Inspect rebuild and or replace the mags and I am willing to bet you will end up with a 100% functioning 1911 again. Occam's razor is in full effect!!!!!
The gun functioned 100% at one time. You have not made any modifications to the gun since it ran properly. The gun only has 800 rounds through it. That is not enough to have worn out any parts again IMHO.
Have you shot the gun with other mags or used your mags in another 1911 that you know is functioning 100%? This would be my first step in trouble shooting. It will help you determine if it is in fact mag related again IMHO. Only once you have determined that it is not a mag related issue should you start to look at more complex explanations.