On the BA box of my 1946 Sq4 I had machined a groove near the outside end of the kickstart shaft to take an o-ring. There is plenty of "meat" on the shaft for this and the o-ring keeps the oil or grease in the box. There is no detectable restriction of the kickstart movement. Any good o-ring supplier could advise you as to the recommended size of the groove for that application.
1946 4G, 1950 NG and 1951 VH