A small amount of crankshaft end play is necessary but 3/16" sounds like too much.
All three crank roller bearings in your motor are pinned into position and a thrust washer, #96, at the top of the crank takes up the slack. It’s possible this piece is worn or missing if the motor shows signs of being disassembled before. The weight of the crank is supported in the middle and the crankcase could be worn here to.
The spring, #101, in the lower seal assembly, holds the carbon tight against the bearing face and has nothing to do with crank position.
These motors are quite forgiving so maybe start her up and see what she sounds like! 😀
