I set my intake and exhaust at .017 and .032, as recommended by George Breckinridge at Utterpower, and my engine seems to fun fine.....however.....
I notice a LOT of "floating free play" in the exhaust push rod as the engine is running. The push rod actually clatters a bit, even after it's been running and thoroughly warmed up. I'm wondering if there's any harm in changing it to say, .020 (or even less) so as to remove some of that slop. It seems to me that I've read of others reducing it without any ill effects and getting a quieter engine in the bargain.
Frankly, I can't remember working on any engine with that much rocker arm clearance, however I'm not sure if doing this would affect the cam/valve timing in some fashion.