By way of an update, I am pleased to report that my DA 7400 headset is now installed, and nothing more than a standard/light facing was done to the frame. After the original post & feedback, I got some quotes for new fork as well as a steerer tube extension, and then weighed my options for another week or so, before I ultimately brought the frame in to the LBS for their advice. Beyond the light facing, the LBS replaced the stock, recessed, notched washer with a nearly identical, though very slightly thinner washer. Further, I apparently did not set the rear edge of the bottom cup completely flush against the head tube, which they corrected. I could have even gained another mm or so by removing the plastic seals if absolutely necessary, but the light/normal facing, resetting of the bottom cup, and different washer all combined to do the trick.

A question for miamijim (if you are out there): In your reply above, you advised not to use anything but the stock DA washer. The new washer is basically identical to the stock washer when viewed on top of each other--the new washer being about a mm thinner when viewed from the side--and it fits perfectly into the DA headset. Is there any reason I should be concerned about the new washer if it's a perfect, albeit slightly thinner, match?