Replacing 30 yr old tires; the new ones don't fit I pulled an old touring bike (Ross circa 1980) out of the basement and bought new tires for it. Both the old tires and the new tires are labeled 27 x 1 1/4, but the new tires are larger than the old. They fit into the rim fine, the inner diameter of the tire is correct. But the new outer diameter is greater, and the new tire rubs against the fenders and cannot spin freely. The new tire also seems wider than the old but I didn't measure and am not certain.

My question is, since the inner diameter of the new tire is correct with the 27, would I be able switch to a smaller size to accommodate the fender, or am I stuck with what I have? The new tires I bought are cheapo Bontrager touring tires ( http://bontrager.com/model/08860 ) - if I bought another brand or style in the same size, would that help?
You can find 27x1 1/8 tires pretty readily. You may want to try that smaller size. The height of the tires can vary a bit by the manufacturer.