The weatherstrip adhesive you have now is not the product you knew and loved in '77. I used to use it quite a bit too, it has been severely changed for VOC content and absolutely does not work as well as it used to. It comes loose now even from rubber, which it is designed to grab the hardest. It lumps up even more than it used to to make uneven thickness. It DOES crack now with temperature.............and it is one of the most inflexible gasket sealers out there, but always was, even back then. Don't know where you got that idea. I don't use it at all for gaskets anymore, way too many other much better products. As flat as you have it now one of the better silicone gasket makers may work well with no paper gasket at all. I'd be trying it with no paper gasket.
No way will a paper gasket seal without crush, the crush is what squeezes the pores of the paper flat to not leak, simply gluing it up seals the sides but not edges, which will eventually seep coolant. The crush also seals gasket from coolant getting in it to soften it to come apart, after all the special chemicals in there it is still paper..........
Using original rubber gasket the cover was never intended to be dead flat, the steel inserts hit first, why they stick up slightly.
The original tightening is closer to inch pounds, if you repeat that the paper gasket will leak.