I'm not exactly sure what you've got (what is the difference between a 1600 crank and a Lotus crank? Is it a stroker?) but it wouldn't matter because I'm not schooled in the different ways of building Kent motors. I will say that 0.012" seems like a pretty small gap between a crank and a block although in my brief motor building days, I never even thought to make that measurement. I would also say that if your crank bends 0.012", you would have real problems. In fact, I would think you'd have real problems before it bent that much! Consider the gap between the bearing and the journal.
That being said, if I were in your shoes, I would investigate relieving the block a little just on general principles.