The elephants foot on the indicator will fix the problem as the standard nib has a ball end and you essentially have one radius against another .
John ,
my comment was aimed at the layman or novice as they read about how this guy set up an old morse taper in the lathe ran a DTI along it and set his compound so he got a zero reading along the length of the taper then machined the new taper that was perfect .
in reality this rarely happens and they wonder why they can't get the set up right and the indicator set up is one of the reasons they fail .
How many machinist double check their setup after tightening down the compound slide nuts ? This can make the slide walk around a little on some lathes and all of a sudden without knowing it you're out of kilter !
I have seen some use a 123 block clamped to the side of the compound slide and the whole lot jiggled into position against the side of a morse taper held between centres to set the compound angle you would be surprised how close it got to spot on but i suppose it depends on how accurately the side of the compound slide is machined to the dovetails .
there's more than one way to skin a cat. The hard bit is catching the buggers !