Anyone Else have an "O" ring problem when changing out their Roof Motor?

I went to change my roof motor this weekend. When I went to reassemble, I noticed this "O" ring was much too large for the housing it is suppose to sit in.

Knowing it would be impossible to understand what I am talking about via written text, I am including a picture I took off YouTube.

Anyone else have this problem, or did the previous installer just replace it with the wrong size O ring? (Though everything looked original)

Looking closer at the picture, is the O ring suppose to sit inside a groove?

You may find it easier to fit the seal to the top of the spacer and then assemble