Joined: Mar 2008
Posts: 5,559
Likes: 53
From: The 'Wack, BC, Canada
Bikes: Norco (2), Miyata, Canondale, Soma, Redline
You don't say what the brand of bike is. If it's one of the big box store bikes then this is simply another example of why these bikes cost so little. If it's a more major brand then it would appear that there's something more serious at work. Like a welding burr inside the head tube perhaps.
You could simply keep adjusting things as suggested by FBinNY. Or you could help it along by taking out the fork and tapping the cups fully home with a couple of blocks of scrap wood and a hammer. But if the cup that isn't seated doesn't move easily I'd take it in and have the cups removed and see what is in the way. It may be that the weld bulged through into the head tube and is holding the cup from seating fully. Or there may be something else.