Ok, when you look at the Sheldon Brown site, there are 3 freehubs:

Shimano Cassettes & Freehubs



The uniglide has all the splines the same width, and does not take a lockring (only a locking sprocket). The Hyperglide/Uniglide compatible has the narrow/wide spline for one of them, and will take either a locking sprocket, or a lockring (which is what you have).

I thought those hyperglide/uniglide hubs were only for 6s and 7s cassettes, so I'm a bit surprised the 10s fits on it.

Is that a Shimano hub? Have you ever taken the freehub off? It is possible you cold replace the freehub with an 8/9/10 freehub.

So, you have few choices:

• Try a cassette with 12T as the smallest sprocket.
• Try to get the perfect back spacers, and hope it holds. You'll also get fewer threads for the lockring. Clearance between the lockring and the dropout may be an issue, although it looks like you should have long enough of an axle sticking out.
• Try to find a replacement 8/9/10 freehub.
• Grind a groove into the freehub to be compatible with 11T sprockets. This may ruin the freehub for using uniglide cassettes, but perhaps it doesn't matter.