Maybe not a true solution but I solved the error by creating a new 2D camera and 2D vision process. I still had the discrepancy between automatic camera calibration and override standoff distance ( 1119 mm vs 416 mm). Orthogonal gave similar results to my 416 mm standoff so I decided to go with Perspective with the standoff distance overridden to 416 mm.
This did give me a mean error of around 1 pix and max of 3 pix but since I am using 2.3 MP camera on a FOV of around 100 mm square, a max calculated error of 0.15 mm is ok.
I also found that changing the center origin point in the vision process removed the slight offset I was seeing on pickup.