We all feel your pain it's a miserable design. I've found a way that works for me, not sure if I can explain it very well or not, but I'll try.
So, if you take the Oring and lay it flat on a surface then try rolling the sides of it (round cross section of the ring) across the table/bench you are on, you will see that it wants to naturally return to the position it came in - ie, the inside wants to return to the inside and the outside wants to return to the outside. Another way to say it is, try to rotate the sides of the Oring so the inside is running on the outside and the outside is running on the inside - when you let go, it will spring back to the way you received it. This is because the inner edge is shorter than the outer edge and, being rubbery, it tries to return to its most relaxed state.
This tendency can work against you, or you can use it in your favor. If you roll the ring into the groove you naturally end up with the inner edge on the outer side and when you let go, it wants to roll itself out of the groove and back to it's relaxed state. OR, you can put a first section of the Oring into the groove with the natural inner edge on the inside and then work your way around it with one hand holding the first part in the groove and the other hand pulling the Oring out and rolling it in your fingers before you put it in the groove so it is sitting in the groove in a relaxed state - if you get all the way around doing this it will stay in place on it's own because it is not trying to roll anywhere. If you have it twisted slightly so it wants to roll towards the hub/bearing casing it will tend to stay as opposed to trying to roll out of the groove. Whew, that's the best I can think of to explaine what I mean, sorry if it just confused you.
Having tried that, I also would like to point out that there has been some debate about the importance of the oring. Some, like myself, doubt it's necessary - I think the gasket is what seals things (but I still use the Oring 'cause I'm intimidated by the karma gods
). I personally like Permatex Aviation form a gasket, a light coat on both sides of the gasket and good to go.
BTW, I hope you first confirmed the bearing spacer sits .001-.004" proud of the gasket so the bearing outer race is held tight (See section J.4 in Bentley book). It's not uncommon to need to make a gasket of a thickness different from the one the parts supplier may send.
Dave