The setup is basically ok, but you probably should have had something to keep the jaws under tension when you were grinding them. I did one many years ago without having the jaws sprung outward in tension and I wound up taking too much off trying to get them more even. The chuck works ok, but it no longer holds small diameter items like it used to.
The best idea I've read about for a jaw fixture is a plate with three holes drilled where the jaws would be if they were holding a piece of stock, maybe 1.5" in diameter. The jaws just fit through the holes. The center of the plate is bored out so that the large central hole breaks a little way through each of the small holes. That allows the jaws to protrude a just little into the large central hole. The angled sides of the jaw faces bear on the edges of the holes, keeping the jaws under a little tension when they're being ground.