Or you could have an ejector like came on my .223 bull from Illion through the accessory barrel program (Yes, the one that took 5 months to get back - went in June 18th 2008).
All the ejectors were supposed to have been gone - mines an ejector. All the barrels were supposed to be 1-9" twist, mines a 1-12".
It should have an ejector that was made for a .223 diameter case, it doesn't. I could care less how much polishing you do on the chamber - if the ejector doesn't come up high enough to catch the lip of the cartridge case, it won't work. Looks like maybe an ejector for a larger dia case.
It will spring down - farther away from the case, but not up towards it. And the ejector housing is not packed full of machining chips like others have found, it was clean - looks like it's just the wrong ejector.