Question on pin diameter

On the Morley below, the pin appears original but its diameter is much smaller than the blade through-hole.

Is this the normal condition?

http://i.imgur.com/0psQB.jpg

That is perfectly normal. Some of the older blades have a much larger hole. No more than that is, I wouldn't even sleeve it...but that's your call.

I wouldn't either. It will be fine as is. Of course, if you do sleeve it, it would be a nice precision fit.

Which leads to my next question, obviously the manufacturer could have made the hole any diameter they wanted.

Is the slop some kind of mechanical consideration in the design?

This "slop" is perfectly normal and the particular razor you have shown actually has less than most razors I have encountered. You want the hole to be a bit larger (when making razors as some of us have) to allow for the pin to be compressed during the pinning process. If the hole in the tang of the razor was a tight fit, after pinning, the pivoting would damage the scales over a period of time due to the pin rotating. The intention of the pin is to hold the sides of the scales tight to the tang of the razor & the tightness is the friction of the sides of the scales to the tang.

I would worry that a sleave would be something that would hold water in.... I would prefer to leave it out.