Before you adjust the arm of the machine or try to straighten the neede bar, you might try adjusting the needle bar up slightly. Miller helped me fix a No9 that had its needle bar set to low. This was causing the needle to strike and rub the hook. The needle bar had a collar with a screw. Loosening the screw, you can move the needle bar up, down, turn, or remove it completely. Since you say the "fat" of the needle is rubbing, it sounds like your needle bar is too low. Causing the needle to go too far down at its lowest point. I would try adjusting the needle bar up first.?
I only know No9s, so I am clueless if No8s have a collar for the needle bar. Someone else might be able to advise you further.
Hope I was of some help!
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Anthony from N. California
avs