If you answer a few questions, I can walk you through the mechanics of tuning up the micrometer.
Are the tip of the spindle and the anvil flat and parallel to your satisfaction?
Do the digital numbers and the sleeve/thimble scale readings agree, just not on proper zero?
Do the digital numbers show an acceptable zero when the spindle is in contact with the anvil?
The thimble is mated to the spindle on a taper. Remove the ratchet stop screw and ratchet stop. Then put a little side pressure, back and forth, on the thimble at the scale end (not the ratchet stop end). What you're trying to do is to release that tapered fit. The thimble is only held by the taper (no rotational key). The thimble scale can be zeroed to sleeve scale with no problem at reassembly.
I think
@BGHansen has been inside his same type analog digital mechanism so I'd like him to chime in.
Bruce, my thinking, assuming the spindle and anvil are OK, is to turn the spindle down until the two mate. My question for you is, if the digits don't read zero at that time, can the digit set be independently re-zeroed relative to the spindle rotational orientation? Or, are the digits driven without any re-zeroing capability? I have some of the same type of micrometers, but I've never been into the analog digital mechanism.