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I am getting ready to attach the finished neck on my guitar, it is m/t bolt on, i put it on as a dry fit and laid the straight edge on the frets and to the bridge location and the straight edge almost touches the bridge(no saddle yet) how much room should there be at the bridge without the saddle, and also i am using a 25.4 in scale fingerboard so the measurement from the nut to the front edge of the bridge should be 25 1/4 inches is that correct?

It depends on the thickness of the bridge, on mine the straight edge lines up with the top of the bridge using a 3/8" thick bridge. As far as the bridge location I set my bridge so that the scale length ends up about 1/16" on the bridge and then I compensate from there. I'm sure there are different ways to do it, but this way works for me.

allowing a 1/16" at the bridge, does that come from jonathan kinkades book, because i read that in there but it didnt seem very clear

That is correct, that's where it came from.