As far as shooting off the magazine, we shot some drills mostly offhand except for the first shot allowed arms on a bench while kneeling at 200 yards, second shot was prone off the magazine at 100, sitting at 75, kneeling at 50 and standing at 25 with 223/5.56 and there was not enough difference across the board to miss the vitals of a deer much less the whole deer.

Something is wrong and as Yondering said, your scope is centered 2.7" above the bore with a LaRue SPR mount. I'd start by sighting in at 200 yards dead on then work your way in noting POI at each distance.