MAGNETO SEAL?

The Magdyno has an oiled felt seal on the drive spindle. On Nortons, the Magdyno moves with the mounting plate and the opening in the timing cover is large enough to deal with chain adjustment. 

The Magneto drive is a closed chaincase that is oil-mist lubricated via the inlet cam bush. In theory, keeping dirt and grit out is a good thing. In practice, it's not a major wear area. 

There were a number (at least three) variations of mounting platform overhang. The Magdyno should sit quite close. If you have a large gap, then you should check the sprocket alignment and that you have the correct platform. 

Not standard but I usually fit a felt type or sometimes cork.  I hose my machines down and am aware of water ingress to the mag drive casing.
 

I had problems when the breather pipe at bottom of the magneto drive case was inadvertently plugged with mud. I went for a long ride in heavy rain and rain entered though the top opening and frothed up with the oil mist in the case and over-flowed into my magneto until it was so full that coffee-and-cream coloured goo came out of the magneto case seams.  
Fortunately the mag interior cleaned up nicely with no damage done. 

I now routinely check that this breather-drain tube is open for business. 

I made up a large gasket using dense felt, to fit between the case and the magneto which seems to have weatherproofed that zone.  
Yes, there does not seem to be any mention of a gasket in the late 40s/early 50s parts books.  I would suggest that you keep the rubber ring until it fails then make up one out of hard, natural-wool felt.
Grant MacNeill