Thank you so much for your explaination. This explaination addressed the issue.This may help to explain things in your setup.
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The modulator output is measured between a and Ref1. The demodulator input is measured between b and Ground (Ground is Ref2.
Note that the voltage at b is affected by the current through R1, R2 and the transistor base junction. Hence the demodulator input waveform is offset from the modulator output waveform.