If I were peening, I think I would be inclined to peen from the outside of the plate. This would put the flare, that is unavoidable, to the outside where you need it. If it is a beveled plate you could easily peen on the bevel to spread things a bit. If it is a round faced lock, the surface near the edge could be peened as well. In either case there is plenty of material on any commercial lock to true things up with a file afterwards. Now, this is a suggestion without seeing your situation. It may be beyond what can be closed up using this method.