Help me figure this scope mounting out

Sounds about right. The bore is beneath the scope, so at close range, you may have to turn the scope all the up to have them coincide. If you have your bore aligning with your scope at 20 feet, its going to shoot really high.
 
it is a bore sighter now take the rifle out and shoot it a 50 yds and make adjustments as need
bore sighter are not the same as sighting it in
You have much to learn Grashopper
I agree with this post. Most barrels will vibrate as the bullet is travelling up the bore - so where is the muzzle pointed as the bullet exits? That is where the bullet will go - not necessary to where the bore was pointed when the gun is not fired. My brother has an example that must be 6 inches or more difference at 30 paces or so - his receiver / barrel was swiveling sideways, too boot. At some point, you have to fire bullets and make holes - and then verify that is where your scope is pointed. We used to call that "sighted in" - what you describe doing is what we used to call "bore sighted" - not the same things, at all - although the "bore sighting" usually is a step towards "sighted in", but you are not "sighted in" unless you shoot and make holes in a target.
 
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