I measured the dropouts: right on at 135 mm. Generic made-in-Taiwan steel frame not bent.

The locknut-to-locknut distance is right on at 135 mm with a 145 mm axle length.

The freehub is set so it's a straight shot from the middle chainring to the middle cog, just like the book says.

I measured the spacer: 8 mm. It's on the non-drive side of the wheel.

My contention is correct: poor choice of components for this bike as it came from the 'factory'. Same thing goes for the derailleurs too but that's a whole separate issue.

And to think what a great company Schwinn was once.