Just got the 742 HP spinning and put on a shimano stradic fj, its a little heavier reel then I'm used to (vanquish-Exsence) but it seems to balance 

this length of rod about perfect....

 

Anyways, I tightened the reel down and its almost like the reel seat is to small, it tightens down and is solid but does leave about 1/4" exposed above 

the blank where the epoxy ramp is, if that makes sense.

 

Is this normal?

I understand what you mean. The nut that is used to tighten down on the reels seat, keeping the reel in place does not tighten enough to touch the other part of the reel seat. I have seen this before. It was with my stradic fa and n v by 31. It didn't bother me, but the reel seat broke when i over tightened it. If you send a picture that would help. If it bothers you, do something, if not you're fine, it might add sensitivity

I have a 3000 Stradic FJ on my 742SF and have had no problems at all.  The seat is designed to fit a range of reel foot sizes so there will be some variation depending on reel model. 

I have a 2500 Daiwa on my DX742 (pre-HP) and also have not had any issues. I've never read or heard anyone having such issues on an over-the-counter Shimano or Daiwa spinner so you should contact Gary or Richard and see if they can help figure out what's going on. No reel handle threads should be exposed.

I will see if I can get a picture, its not bothersome as long as its normal and does not cause any issues 

down the road....

pics-

 

Before adding the reel

 

After adding the reel.

That is exactly how my FK sits on my Sierra 703. However my Daiwa BG sits perfectly flush.

From that photo, it looks good to me. I would definitely not crank down harder on the locking nut.

This is the area I'm talking about, just in case others thought I was talking about below the locking nut.

That is exactly what my Sierra does with my Stradic on it.

 

On a side note love the avatar! Used to own the knife still own the strop.

I tested a bunch of Sierra rods at Cabela's and they all did this with a variety of reels from a variety of brands.  Took those same reels and put them on another rod brand with the same Fuji seat and they all worked perfectly.  I showed one of the employees and he was stumped too.