I don't know what you mean by
but it is too small to eliminate the elements of diag(B).
I read in Pal, formed B, then executed
B - diag(d,0) == hermitian_semidefinite(N)
cvx_optval = +3.28872e-07, min(d) = 6.711493410820829e-09.
Using SeDuMi, cvx_optval =: +3.91062e-09, min(d) = 7.861089211967724e-11.
So this is as I predicted in my first post.
Note that you need to pay attention to Status returned by CVX. When I used d >= 1e-6, Status was Inaccurate/Solved for both SDPT3 and SeDuMi.