Short story is that I switched out the pump and the replacement seems to work great-I even made my first espresso!
Thanks for all the help... I've posted a long series of questions trying to get this machine to work (probably more when I next break it) and I've got very helpful responses each time. My goal was to learn about espresso machines and maybe get one working, success!
Longer story is that when I purchased this machine it also came with a backup parts machine. I thought the pump in the parts machine was supposed to be broken, but I switched it in anyway and everything works now.
I'm pretty sure that the machine that I've been trying to get working (and was working well they say when put into storage) must have frozen while in storage. The heat exchanger was burst, and now that I look at it more closely the pump seems to bulge out slightly on the bottom where the plate with the company name and info is. I notice that on the replacement pump there is no bulge, so I guess things must be slightly misaligned inside the problem pump. And that misalignment must be why it can't reach full pressure.
I did take off the side acorn nut on the problem pump, but it doesn't look adjustable to me... the threads seem welded (or very stuck) into the acorn nut. I think I read that it's set at factory and not meant to be changed... you are supposed to always use OPV on the output side of this this pump setup I guess. I'm including pictures of the opened acorn nut and also of the slight bulge on bottom of pump.