Was the cowl replaced? Just the inner fenders? Were they reproduction parts or NOS?
I'm hoping everything isn't already painted yet, but if it is, as Jeff mentioned, an 1/8" isn't a whole lot.
It has been my experience that such details ought to be fit into place as a test-run using a few sheet metal screws to secure the panels temporarily, before finish welding and most importantly, PRIOR TO PAINT. This can save a lot of grief damaging the finishes on any of the panels. I think we take forgranted at times things will fit correctly because they went in so easily, especially if we buy NOS replacement parts.
If hogging out the hole sounds like a bad idea, then another option if you haven't painted the aprons yet would be to remove the hinge from the inner fender on the problem side, take a 2x4 and a heavy hammer and tamp the inner fender in about 3/16"-1/4" if possible, but at minimum the 1/8" you need. I don't mean to say "cave it in", I mean to say gently adjust it like the aforementioned thread shows pictures of. Personally, I would have wanted a test-fit of the hood prior to welding anything in.
Reproduction sheet metal will give you "fits" with fitment...nothing new.