I believe that you are referring to the diameter of the "bearing
seat", a very short cylindrical portion of the fork crown where the
lower Crown Bearing (which has a 26.4mm I.D.) fits.
Yes. The crown race cutter will cut it to size but remember that there
are two sizes of cutters (actually more then two) 26.4 and 30.015 for
1" threaded and 1-1/8" unthreaded.
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Cheers,
John B.