Just put new pads and rotors on my 08 MCS. I put green stuff pads and DBA vented/cross drilled rotors on. I notice that the old pad surface did not extend to the end of the rotor (which causes a small lip to form)... the pad surface on the new pads extend @ 1/4 inch past the rotor edge.

Is this ok?

 

No it isn't ok. I suspect you have the wrong rotors. Compare new rotor diameter directly to only rotor diameter, should be exactly the same.

 

I would check the caliper mounts -- loosen and see if they can be moved in a little. Some over hang is ok and not unusal, but a 1/4" sounds like a lot.

 

+1 on checking rotor part number and caliper mounts.

 

Yup, Check part numbers, and installation.