I finally got the Shimano dynamo hub apart and sure enough, a magnet was loose, apparently lifted by rust forming between magnet and iron field ring.
It isn't hard to sand the rust off the magnet and field piece but it's quite hard to remove the resulting magnetic particles from the assembly. Just a few bits of debris left behind will keep the magnet from settling into place and thus give clearance problems.
Does anybody have a good way to grab and remove magnetic debris with the consistency of flour to fine sand? I've tried masking tape, but it's slow and won't reach into recessed spaces. Thanks for reading,
bob prohaska