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there is about 2mm of spacer appearing above
If you're using a conventional cap which sits down inside the top spacer, it could take up all of that 2mm once you've tightened it. It only needs about 0.2mm difference from what you had before to make the difference between the cap clearing the steerer and the cap hitting the steerer before the bearings are free of play.
Anyway, you can answer the question definitively by putting the other spacer back in and trying again.
Is the headset adjuster cap hitting the steerer when you apply the bearing preload? This is likely if the stack height of the new stem is less than that of the old one.