That 2" sounds about right. I have four Israeli K98 7.62 rifles and the two with good bores will shoot LC ball into 1 1/2"- 2" for 5 shots or 2" for 10 shots at 100yds. With handloads a little better. That's off the bench with bags. The sights are challenging to my 49 year-old eyes. OK for 200 yards for me though. As said by Bruce above, the tall front sight can be modified to give a good 200 yard zero for your load plus some adjustment.

I have been tempted to use one of mine in the Vintage Match at the CMP Western Games - Always went with another rifle though (M96/38, M96, M91 Argentine, Finn Nagant, K31). The front sling attachment isn't perfect for the 1907 sling but the canvas sling clip can be modified to work.