I don't have extensive experience with UK-built pianos, but from what
I've seen the action specifications on uprights like yours are similar
to those of the USA.  In which case, a 1-inch hammer strike distance is
way too close under any circumstances I can think of.  Was that "1
inch" a typo?  1 and 7/8 was a typical factory setting for a large
upright, and I would expect that after wear and perhaps filing of the
felt the distance might need to be shimmed up to 1 and 3/4 or so.

As for the key dip of 3/8 inch, I don't consider this an absolute.
Different piano makers call for depths ranging from 3/8 to (on a few
spinets) 7/16.  So, if you have to increase the depth to 13/32 to make
everything else work on a used piano, you will not be outside the
normal range encountered by pianists.  Of course that affects other
things like checking.  A good plan, as I found out myself in hindsight
after working on my first few pianos, is to start by regulating just
a few notes until they function properly, and then using these as a
guide.

There are two items to quickly investigate on note 31 before further
adjustment.  First that the hammer return spring is in proper position,
and secondly that the catcher (balance-hammer in England) is glued
firmly in place.

I hope these thoughts will give you some ideas for moving forward.

Richard Friedman