You are on the right track with this, I believe someone actually makes an insert
to do just what you are attempting.Just don't remember who. Check with these guys.

https://www.customcycleengineering.com/

 

I used the bushing they worked fine for 8 dollars I would Change the gear but I don't have a puller or a 1 7/8 deep socket I appreciate the help thanks Mark

 

If you wanted to, you could just use one long bushing in the tranny case or you could update to a 02-07 swingarm/wheel setup like I did.