We have a custom engine that fit just fine in a 1967 BUS, and we're now trying to transfer it to a 1967 Bug, and although everything lines up with the transmission, it won't fit in. It's in the engine compartment, aligned, same size flywheel as the old engine we took out of it. All seems well, clutch is centered. Anyone know what could be keeping it from going onto the transmission spindle?

There's no reason why it shouldn't fit. I'd guess the alignment is not quite right. Select a gear and try turning the rear wheels as you try to push the engine in, you can feel the progress then.