Maybe your turntable setup is actually okay . . .
One of the most oft-repeated bits of advice I read on these forums is to "check your turntable setup" . . . to the point of being a blanket cure-all for any manner of dissatisfaction with one's turntable. Add to this that there seems to be no limit to the required obsessive details about various protractors, geometries, mirrors, jigs, etc. that need to be discussed, and their associated belief-systems that need to be adhered to . . .
Well, it actually IS possible that a turntable has a PERFECT setup, but still has performance and tracking problems. So if you're still frustrated after dorking around with your turntable ad infinitum, you might consider the following:
1. Many cartridges (especially MCs) have distortion mechanisms that are completely independent of the tracking performance - that is, distortion can still occur even with absolutely zero mistracking. I find it plainly audible with trackability test records - as modulation is increased, there are sometimes one or two different-sounding distortions that are heard before the unmistakable onset of mistracking. These are frequently caused by dried-out cartridge suspension, or are peculiar to the cartridge design itself. When listening to music, it's REALLY tough to differentiate between cartridge distortion and mistracking.
2. The concept of whether to align to the cartridge body or the cantilever is ridiculous. They SHOULD be one and the same. I verify this under a microscope BEFORE beginning mounting the cartridge . . . I can't imagine doing it any other way. If it isn't, repair or replace the cartridge.
3. The diamond stylus itself should be mounted squarely to the cantilever, and the cantilever should not be twisted. Again, a microscope is necessary to make sure. Again, if it's not right . . . repair or replace the cartridge.
4. The mass/compliance relationship between the tonearm and the cartridge must be correct - around 10-15Hz resonant frequency on both the vertical and the horizontal planes. If this isn't correct, then the stylus simply won't track correctly. Usually the mistake is so the resonant frequency is too low, which causes the stylus-to-record contact force to vary wildly with tiny warps, footfalls, and record eccentricities.
5. Damping troughs, gooey goo, and headshell weights, while helpful for some situations . . . cannot compensate for poor tonearm/cartridge matching. The fundamental mechanism is still the cartridge compliance and the tonearm mass.
6. If the tracking problems increase as the tonearm approaches the inside of the record, this does NOT necessarily mean that the change in tonearm/record geometry has anything at all to do with the tracking problem. The inner grooves simply exert greater forces against the stylus to acheive the same amount of velocity, hence modulation, as the outer grooves. So even if the tracking ability of the cartridge is perfectly constant across the record, it can frequently be sufficient at the outer grooves, but not the inner ones.
7. Many cartridges are simply not very good when it comes to tracking ability. Maybe they have other virtues, and are worth owning in spite of this. I know, I know . . . "my spherical-stylus Ortofon SPU can track the Telarc 1812 Overture disc with zero distortion!! Your setup must be off!!!" That is, quite simply, a load of crap. You don't buy an SET amp for the efficiency, you don't buy a Jaguar E-type for the heater, and some audiophile cartridges should NOT be counted on for their tracking ability. Decide what's important to you before you spend your money.
If it seems like I always blame the cartridge for inexplicable tracking problems . . . well, this isn't too far from the truth. In my experience, quality control for phono cartridges is much worse than for most other parts of the audio chain, regardless of cost or manufacturer reputation (with maybe one exception, but they don't make cartridges anymore). This is simply because so much of the poor workmanship or damage requires a microscope to see, or can't be seen at all, and even if it's perfectly made . . . these things go through many people before they reach your tonearm. When I buy a cartridge (formerly as a dealer, now as a consumer) I make sure that if I'm not happy with it after a visual microscope inspection, setup, and testing, I can send it back for another one, until I'm happy. I've sent back LOTS of cartridges and ticked off lots of distributors to this end. The tradeoff is that I simply can't consider brands where I don't have a good relationship to the dealer, and I probably pay more than many people on Audiogon.
I sent back two Linn Klydes to get the one I have now -- one had the diamond mounted a degree or two off, and the other had an intermittently open channel. I'm not bashing Linn . . . I've set up a good handfull of their cartridges, and overall, I'd consider them above average. But I can't count how many cartridges I've sent back over the years, and what pains me is that some of my Audiogon brethren probably have my rejects on their tonearms - after all, I'm pretty sure that they weren't all simply thrown away.