Homer,
If you said you were getting around 2" groups I would have some hope that some tinkering with bullets and loads may tighten you up to the 1" range but I have yet to see a 3 to 4" rifle shoot well with only a load change. Not saying it is not possible but it is not likely.
First thing I would do is try some 100 gr Ballistic Tips. I have seen alot, in fact most 25-06 rifles that would simply not shoot the 115-117 gr Boattails or 120 gr bullets well at all. Personally I feel it is a twist issue with factory rifles. Some will but nearly all 25-06 rifles will shoot the 100 gr Ballistic Tips very well.
Try this first, if it does not improve groups which I would suspect it will not dramatically, I would say take it to your smith and let him look it over as it sounds like a mechanical problem to me.
If this rifle came in my shop, the very first thing I would do would be to clean the bore to bare metal. Clean it till you think it is clean and then let it soak overnight with Tetras copper cleaner. In the morning if it comes out blue, you aint finished cleaning.
Once totally clean I would recut the crown, cheap and easy to do and will often result in major accuracy improvements even if it is a clean factory crown which are generally a couple thou off the axial alignment of the bore.
After that I would look at the bolt locking lugs, are both baring evenly? Does the rifle shoot well at low level loads and progressively worse as pressure and velocity increases. THis is a sure sign that you have a floating lug and with the lower pressure loads the bolt is stiff enough to support the case but with top loads it flexes the bolt severely.
After that, check the bedding but unless it is extremely bad, this size of groups are not a result of poor bedding alone. Unless the receiver screws are loose.
Check those, scope bases screws, base windage adjustment screws(these slip loose quite often) and ring screws.
Is the scope a proven quality scope? If not get one that is and test the rifle with this scope.
If none of these work, I would say its time to either cut your losses and trade the rifle off or rebarrel it and have it accurized.
What brand of rifle is it? You many have said but I did not notice. If it is a Rem 700 make sure the bolt nose recess in the barrel is clean and free of debris. If there is something mashed between the barrel and the bolt, strange things happen to groups with a Rem 700.
Kirby Allen(50)