This package 32M1-A 5mm body, 0.5mm pitch.
You should pay more attention. For instance, there are no "1mm pitch" ATmegas. The LQFPs are 0.8mm.Also, none of the packages are known as "FQFP" You've got your 0.8mm "LQFP", and 0.5 and 0.45mm "MLF" (leadless) packages...
That's a 5x5mm TQFP-32 with 0.5mm pin pitches (example drawing: http://cds.linear.com/docs/en/packaging/TQFP_32_05-08-1735.pdf). The ATMEGA328P is in a 7x7mm TQFP-32 with 0.8mm pin pitches (datasheet: https://www.sparkfun.com/datasheets/Components/SMD/ATMega328.pdf page 436). So you chose the wrong footprint. I wonder if you couldn't force the 32-QFN 0.5mm version of the ATMEGA328P onto this footprint but I wouldn't count on it. And they are pretty hard to solder too, though not hardly impossible. The 7x7mm TQFP-32 isn't going to work out. You would need some sort of adapter to match it up.I always print out my PCBs and make sure the components line up before I send them to be manufactured. Printouts from a laser printer are very accurate. It gives complete confidence you will be able to solder your parts correctly (assuming appropriate skill) so at least you can have some confidence there.
My PCB program lists a "TQFP32-5MM" package type
Ah. That's more understandable. But your PCB package is wrong, apparently. The 168 and 328 don't seem to come in that package at all! This is a problem with cad-package libraries that you haven't carefully checked, whether they be included from the software vendor, downloaded from a 3rd party, or created yourself...
Riddle me this, is the pitch-sizes fixed for the various package types?
Are you saying the 5mm, 0.5mm pitch parts I pointed out do not fit the 5mm, 0.5mm pitch pads on your card?Atmega328P-MU, -MUR, -MN, -MNRhttp://www.mouser.com/Search/Refine.aspx?Keyword=atmega328p-m'Read the datasheet, take some measurements, compare to your board.