What is the runout at the Joint Collars PRIOR to drilling and boring? Are you able to Chuck up a piece of stock, turn it round, flip it in the Chuck and still get a tight runout? If not, your Chuck may may be the problem.
What Chuck are you using? Many factory 3 Jaw chucks should be used as Boat Anchors and never for accuracy, (Four jaws are the best but they take time.) I have no idea what you use. I use no Chuck at all for Center Pin alignment, I make my own Collets that fit my Morse Taper # 5 of my Spindle. My Collets are 3" long and have no slit in the side, they are solid. My Spindle would be measured in the 10,000ths of an inch when it comes to runout, it's that perfect.
I go from a perfect Spindle to Collet to Cue. Many go from Spindle to Chuck to Collet to Cue, every step can only take away from perfection and never lean towards it.
Understand, I use a full size lathe and things are done differently on the smaller Lathes, either of which can make perfect Cues if and when properly utilized.
My assessment is that your a step away from the perfect Joint, don't sand it, fix it at the source.