I was drafting up a long message about what I tried and how I copied the section in every possible combination. Then I tried one more thing. I don't know why it worked last night when Hille Wayne suggested it to me, but I just move INSTANCE BELOW CONSTANT and VARIABLE...BOOM! It worked!
So let it be stated for others to understand:
INSTANCE MUST BE BELOW CONSTANT and VARIABLE declarations.
At least in my situation this is was true. That is subtle, not stated in section 4.2 of Specifying Systems clearly, it is nowhere in the help docs of TLC and due to programmer bias, I placed what I would interpret as IMPORTING at the top which is common with software design (at least depending no the language as I don't know all of them).
The error messages are cryptic and don't help much.
Dr. Lamport, I've seen you sometimes ask for help with the software. Where do we/I go for this?
Thank you Hillel Wayne and Dr. Lamport for your help.