IP Binding Issue in using GRE Tunnel

I have a issue with tunneling and am having a hard time finding a solution. I have two servers, A: Host-Server being a sever with a single IP, and B: Main-Server being the server handling all our applications.

I set up the GRE tunnel fine, but for the application need the (A) server IP ( 192.168.0.1 ) to be on (B) servers Eth0 so the application can use the IP as its own (this is a must). However when I attempt to add the (A) IP to (B) i believe a routing loop is happening, and I cannot figure out how to get traffic to flow correctly. I have tried some PREROUTE and POSTROUTE on iptabels with little success. Below is the setup I get to where everything stops working.

Any help in this would be greatly appreciated!

Details:

Server A: Host:

Public IP: 192.168.0.1
Tunnel IP: 10.0.2.1

Server B: Main:

Public IP: 192.168.1.2
Tunnel IP: 10.0.2.2

Server A:

Add the Tunnel

sudo ip tunnel add test_tunnel mode gre local 192.168.0.1 remote 192.168.1.2 ttl 255
sudo ip addr add 10.0.2.1/30 dev test_tunnel
sudo ip link set test_tunnel up
sudo echo '101 test_tunnel_GRE' >> /etc/iproute2/rt_tables
/sbin/ip route add default via 10.0.2.2 dev test_tunnel table test_tunnel_GRE
/sbin/iptables -t nat -A POSTROUTING -s 10.0.2.0/30 ! -o gre+ -j SNAT --to-source 192.168.0.1
/sbin/iptables -A FORWARD -d 10.0.2.2 -m state --state NEW,ESTABLISHED,RELATED -j ACCEPT
/sbin/iptables -A FORWARD -s 10.0.2.2 -m state --state NEW,ESTABLISHED,RELATED -j ACCEPT

Test the Tunnel IPs to ping and see if response is given (Works).

root@A:~# ping -c4 10.0.2.2
PING 10.0.2.2 (10.0.2.2) 56(84) bytes of data.
64 bytes from 10.0.2.2: icmp_seq=1 ttl=64 time=50.6 ms
64 bytes from 10.0.2.2: icmp_seq=2 ttl=64 time=49.6 ms
64 bytes from 10.0.2.2: icmp_seq=3 ttl=64 time=49.7 ms
64 bytes from 10.0.2.2: icmp_seq=4 ttl=64 time=49.7 ms

--- 10.0.2.2 ping statistics ---
4 packets transmitted, 4 received, 0% packet loss, time 3005ms
rtt min/avg/max/mdev = 49.636/49.945/50.651/0.439 ms

Test on Server should see Tunnel Server IP: (Works)

root@A:~# curl http://www.cpanel.net/showip.cgi --interface 10.0.2.1
192.168.0.1

Server B:

Add the Tunnel

sudo ip tunnel add test_tunnel mode gre local 192.168.1.2 remote 192.168.0.1 ttl 255
sudo ip addr add 10.0.2.2/30 dev test_tunnel
sudo ip link set test_tunnel up
sudo echo '101 test_tunnel_GRE' >> /etc/iproute2/rt_tables
/sbin/ip rule add from 10.0.2.0/30 table test_tunnel_GRE
/sbin/ip route add default via 10.0.2.1 dev test_tunnel table test_tunnel_GRE

Test the Tunnel IPs to ping and see if response is given (Works).

[root@B~]# ping -c4 10.0.2.1
PING 10.0.2.1 (10.0.2.1) 56(84) bytes of data.
64 bytes from 10.0.2.1: icmp_seq=1 ttl=64 time=51.7 ms
64 bytes from 10.0.2.1: icmp_seq=2 ttl=64 time=50.0 ms
64 bytes from 10.0.2.1: icmp_seq=3 ttl=64 time=50.0 ms
64 bytes from 10.0.2.1: icmp_seq=4 ttl=64 time=50.0 ms

--- 10.0.2.1 ping statistics ---
4 packets transmitted, 4 received, 0% packet loss, time 3054ms
rtt min/avg/max/mdev = 50.023/50.458/51.721/0.746 ms

Test on Server should see Tunnel Server IP: (Works)

[root@B~]# curl http://www.cpanel.net/showip.cgi --interface 10.0.2.2
192.168.0.1

Here is where it breaks:

Add IP to eth0:

ip a a 192.168.0.1/32 dev eth0
/sbin/ip rule add from 192.168.0.1 table test_tunnel_GRE

BROKEN

Now everything breaks on both ends, on both servers ping and curl both fail to respond.

I appreciate any info that can help me get this resolved!