I'm not 100% familiar with programming with Fanuc, but I'll toss out a couple ideas. First, the lines between the G07.1s define the shape you are wrapping around the shaft (so a G03 fuill circle, and a short G01 line). Second, are you sure you have the right diameter of shaft that you are working with? Also, have you tried changing the H50000 to C50., just to see if that makes any difference?
I don't know if that helps any.