As you can see above - the cranks are visibly off, which means the precision of this spindle must be pretty far off. Many of these old spindles are not 100% perfectly made, but if they're reasonably close, the cranks line up well enough and the bike rides fine. This one is way off. Visual inspection of the spindle also visibly shows the flats are not opposite each other.
So what to do? This very good video explains how the DL-1 bike had a different bottom bracket spindle - a larger spindle - than the common Raleigh Sports bike. The DL-1 used the larger #08GC whereas the Sports used the #16GC.
It turns out though that Yellow Jersey bike shop in Wisconsin sells an Indian-made copy of the DL-1 spindle. Andrew at Yellow Jersey was helpful in answering my emails and I ended up buying a full bottom bracket kit.
Below is the kit as it arrived. This particular kit was made in 2011. The Indian firm that made it stamped the box with the manufacture date. The spindle is forged steel.
The races are quite close to the #08GC in size and width. It should be noted that the overall spindle is a fair bit longer than the #08GC. The result is that it noticeably moved the cranks outward from the frame/bottom bracket shell. My Raleigh has an aftermarket "horseshoe" or "half case" type chainguard, not a full chaincase. I was able to get everything to fit on the drive side, and to re-use an original Raleigh cotter pin without difficulty.
The spindle and the non-drive crank are a bit tougher. The non-drive crank's holes also seem to have been off a bit when they were bored out. The result is that a stock Raleigh cotter pin sinks very deeply into the hole - I managed to get a pin tight and set just as it maxed out in how deeply it could go. It's close to the end, but it does work. The cranks ended up 180 degrees apart, as they should be.
I plan to upgrade to a slightly larger cotter pin from Bike Smith design. I'll file it to fit, and I will probably have to leave a little more material on the pin than a stock Raleigh pin would have. But hopefully this problem is licked now.
I think the bottom line on the Indian spindle is this: it's close to the original, but it has some differences: the spindle overall is longer and sets the cranks apart wider than the 8GC; and the cotter flats on the Indian-model seem just a little bit more cut-back. However, the races are close enough to the 8GC to work. I have retained the stock Raleigh cups, but I am using new bearing balls with this bike. After assembly, the bottom bracket turns smoothly.
My advice: if you can make the original spindle on your DL-1 work, do it. The original is going to have fewer compatibility issues regarding where your cranks end up regarding chaincase, chainguard, etc. If your spindle is just defective/bent/trashed: I'd give this Indian spindle a try. It's not expensive, and it does at least give you a chance to build-up a working bottom bracket. You may have to play with cotter pins and chaincase/chainguard positions, but at least you'll have a turning and functioning bottom bracket.
That said, I sure wouldn't want to be trying to get this spindle working with an original Raleigh chaincase, though I do think with some patience and fooling, it might work with that as well.