New Brighton, PA
Since the 1/2" collet runs true, my suggestion would be to replace the 1/4" collet or, at the very least, check and see that the run out on the 1/4" collet is consistent regardless of the 1/4" shank router bit that you are using. The thought being is that if you found the run out using only one router bit, it could very well be the router bit and not the collet.
Hope this helps,
Here is my shot at an answer.
To be certain that run out is the issue, check that the 1/4" router bit you have installed to measure the run out with is not the culprit. (Use another 1/4" bit to double check the run out.)
If your 1/2" collet nut assembly seems to perform fine and the 1/4" size is giving you trouble, it would seem to point to the 1/4" collet and nut assembly as being the issue.
If your 1/2" collet nut assembly and a 1/2" to 1/4" collet adapter lets you mount your 1/4" shank router bits in the router with no run out, that helps to build a case against the 1/4" collet nut assembly as being the problem.
Since this assembly consists of the collet nut snap ringed to the collet washer, wear and resulting play could be causing the run out. Inspect the nut and collet washer assembly carefully under a strong light. Look for build up resin or crude, a small burr, or hidden debris jammed into the assembly. Wash it in some mineral spirits and a toothbrush and or 0000 steel wool or a scotch brite pad. If you have a tool to remove a snap ring, take it apart for cleaning and inspection. The washer collet should be smooth on the inside and outside with no burrs or build up. If cleaning the assembly doesn't help, it may be time to replace it.
Also, look into the collet shaft housing on your router to be sure there is no debris or pitch build up down in the tapered socket.
Find a replacement 1/4" collet nut assembly here, and here's the link for a Router Collet adapter
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