You can adjust only the depth of the sensor, which is the gap between it and the "vane wheel" (for lack of a better name). It's done by inserting looooong feeler gauges into the diff through the filler hole, between the sensor and vane. Depth adjustment is accomplished with shims under the sensor.

It's best to back the sensor as far out as possible while still getting a stable mph reading. If you go too deep, the sensor will hit the vane and quickly chew through it. When this happens you have lotsa stray metal flakes 'n chunks floating around among the gear teeth. You also face (1) a massive, careful, and thorough clean-up to get the chunks outta the nooks 'n crannies up near the pinion bearings, and (2) a rebuild of the differential. The "vane wheel" is captured between the ring gear and nest. This means everything must come apart to install the new part. What fun.

In this case, you're better off with a good used rear end assembly.

Having helped someone with this repair job, I speak from experience.