So I recently traded for a 98 Ranger and I was able to drive the truck without a key in the ignition because the tumblers were worn out. I could insert and remove the key regardless of what position the switch is in. So I decided to replace the ignition switch because it was thinking there is always a key inserted, the door chime would go off everytime i would just open then door. Also this may be an important fact, before I started this process I couldn't get the switch counter clockwise into the acc position. I take the old switch out, put the new switch in no problem goes on smooth however now there is a half inch gap from the steering column and the lip of the ignition switch so it isn't flush with each other. However the truck will start but the key will not pull out of the new switch even in the off position and it still won't turn into the accessory position. The pin that locks the switch in place is in the hole correct as it should be. I also know it's the correct switch I've compared it to the old switch and they are identical. Any tips or hints? No one else I've seen has had this problem

 

Did you check if the ignition switch, which is located under the steering column, had full travel before installing the new key cylinder?

The actual ignition switch is a slide switch under the steering column.
The key switch has a metal rod that pushes the slider in the ignition switch into it's various positions when key is rotated.

So remove key cylinder again, and use a screw driver to rotate the key switch to START and then to ACC. to make sure ignition switch has full travel.

Ford changed the key cylinders through out the years, you may have been given one that is incorrect, for the female side.
Since you don't have a history with this vehicle("I recently traded for a 98 Ranger") it may not have a '98 key switch, especially if there was a problem with it when you got it.
Previous owner may have had a problem and just got whole key switch from wrecking yard.