So my barrel arrived today and I went to finish my assembly but when trying to fit my Geissele SMR, it wouldn't fit onto the Mega Billet Upper.  I mean, the receiver end of the handguard on the side opposite the dust cover wasn't close.

The ends of the receiver and handguard were butting up against one another.  The handguard fit over the gas block and barrel nut just fine but then wouldn't mate onto the receiver.  Can anyone provide any guidance?  Has anyone had this happen before? I am new to AR's but not machine work and assembly, we aren't close here.

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I tried to take these with the rail as visually aligned as possible. I WANT this setup but something isn't right here, no?

File the lugs off and refinish or pick a different rail. You're not the first guy to run into this. The Mega arms and some other billet are beefier and not compatable with some rails due to those anti rotation lugs. They aren't necessary.

Remove them all together? Seems excessive no? Shouldn't this setup work as-is or am I overly optimistic?

That's what I would do but it's your rifle.  The Mega is thicker. You can always trim them up until the rail slide onto the nut. Just do it evenly so your top rail lions up.  As stated though you can remove them completely. Geissele rails lock up tight.

That was my first thought and then I googled.  Apparently this is a known issue. Handguards/rails with anti-rotation tabs don't fit the Mega billet uppers. All the research I did on this build, I am pissed I didn't figure this out beforehand. That said, I spent a lot of time searching for another handguard for my build but I couldn't find anything I liked as much as the Geissele MK4, so I did what I told myself I wasn't going to and modified it to fit!  See pictures below.  I was very hesitant to modify a brand new $350 handguard but it wasn't bad and I'm really happy with how it turned out.  I used a dremel with the round sanding attachments and a chainsaw chain file. It took me about an hour mainly because I did it a little bit at a time and then test fit so I could only take off the material I had to.  You can see the anti-rotation tabs are still there, all I did was trim them a bit. Now some BC Aluminum Black and I will be gtg.

Here are the pics:
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Looking at the pictures you did a great job. I had one thought.  Unless you have some clearance on the tab to billet when you clamp down on the guard it may be applying more force to the tabs then it does to the barrel nut.  Could even crack of bend the tabs.

Interesting you should mention that.  I pulled the handguard off because I thought the rails between the upper and guard were a little off.  When I slid it off I did notice one of the tabs was bent back a very slight amount.  At this point, I am going to let it ride.  After using a different scope mount, the rails aligned perfectly and I am calling it good!

Here is the final product.  My first build!

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