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the size of the chamber neck and the room to expand and release the bullet is a lot bigger safety factor
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This is the key. People have been known to jam a .30-06 round into a .270 chamber and fire it without blowing up the gun. Pressure did go way up, naturally.
some years back I remember reading how one of the old time smiths (Ackley I think, but can't remember for certain) got interested in this kind of thing, and made a .270 barrel with enough chamber neck clearance to fire an 06. Turned out that squeezing a .30 bullet down the .27 bore really didn't raise the pressure much, IF there was enough clearance to allow the case to release the bullet normally.
It is possible 98s were rebarreled, not reamed, its also possible guns were reamed and not marked, or perhaps there was a shop mark that we simply don't know how to recognize, that indicates the rifle was converted. It might have been a standard, or it might have been something individual to each shop doing the work. In those days of cheap (compared to today) skilled labor costs, it would make sense that a reaming was cheaper than a rebarrel.
It's also possible that the guns weren't converted by the cheapest possible means, and were rebarreled instead. And remember that the conversion was a one time thing, and all the new rifles, and barrels were made with the new bore size.
Shooting the oversize bullet in a .318" bore probably meant less than match grade accuracy, but that kind of accuracy wasn't what the German Army needed those rifles to do. I believe all the converted rifles were intended for second line and rear area troops, guards, border police, etc.
(where any specific one ended up is, of course a more complicated matter)