Algodoo

It seems to work just fine, unless I'm missing something. Rather than to assume that people can "see the problem" it would be better for you to explain exactly what your concerns are.

Oh ok.
I will precise it.

I think the problem is caused by that black bar (which the stylus is attached to) does not remain horizontal when the stylus moves up and down. The black bar ROTATES, which is causing the error in the resulting trace. So, instead of allowing the black bar to rotate as the stylus moves up and down, you need to alter the mechanism that drives it so that the black bar remains horizontal at all times. That will make your trace follow the stylus much more precisely.

KGameX -- Check out the scene that I created to show you another way to make that tracer device. Let me know if you have questions, and I will delete it when you are finished with it.