Did Peugeot ever use imperial sizes? And if so when did the switch take place? I'm wondering if it's actually a 10-32 size.

It can be hard to measure internal threads on small holes so I'm guessing that he guessed....

Ya know... it may even be that someone forced a different screw in there at some point and messed things up for you. Can you try to look in there with a magnifier and light and see if the threads look clean and crisp or are they chewed up?