If the problem does not occur with irons or scopes then i can't see the issue being with the barrel nut, which can effect accuracy if it is loose...it seems to me like the red dot is rattling around after each shot group. If it is a dud then even the little recoil of the 22 will throw it off. Send it back...either try another or get a refund and go with a slightly higher priced red dot...no need for an aimpoint or eotech unless you are fortunate enough to be able to afford one. Primary Arms or the Vortex red dots are good low to mid budget red dots.