Who said it was the smallest group and why did you assume it was? That's one of the largest groups it shoots...with that particular load and with it it averages 0.893" @ 200 yds...yes for 5 shots. I never test anything at less than that so I have no what is does at 100yds nor do I care. Even high end rifles won't shoot all ammo with consistent accuracy...one load will do sub 0.250" and the next load will do no better than 0.750", granted the high end rifle will have less fluctuation in group size than a cheap rifle. As for the pic I posted the only reason I took and have that is because it was the first three shots I fired with that particular load. When developing I don't waste any more ammo than necessary...3 shots at that distance in that tight a cluster proved it was a match for that rifle...truth is I've been shooting it as is for 2 years and have yet to find the time to fine tune it and see if it can be improved...or even bother trying to find a better load with match quality components.
I have shot 6 different SPS Varmint rifles (2x.308 Win, 2x.223 Rem, 1x.22-250 Rem and 1x.17 Rem FB) and the worst one was still averaging 1.284" @ 200yds with it's favorite load...so although not 0.5 MOA or less it's still pretty damned impressive for an over the counter +/-$600 rifle with tuperware funiture!
At no point did OP ever specify the need for a sub 0.5" MOA rifle! And nowhere does it say that a "precision rifle" is by definition one that shoots sub 0.5" MOA. Now, because the OP asked for a "precision rifle" with a scope for less $1000, I suggested the SPS Varmint because in my experience you cannot find anything else in that price range that can compete with or compare to it. 6 out of 6 rifles I played with were sub-MOA...most flirting the half-MOA mark with their prefered loads! That's pretty good consistency in my books and highly doubtful that it was just a coincidence or a fluke!