When you go to square up the block, place your square ruler (a 6.5" sq works nicely without getting in your way) so that the 45 degree angle line is running from top R to bottom L--centered through your blue name fabric. it should be placed so that you have 5" block in center with the extra 3/4" showing top, bottom, both sides. That should give you the 6.5" squared up block.
Looks like you didn't use the 45 degree angle through the center and instead measured the 6.5"?