Using a three-path contrast interferometer (CI) geometry and laser-pulse diffraction gratings, we create a matter-wave interferometer with ytterbium (Yb) atoms. We present advances in contrast interferometry relevant to high-precision measurements. By comparing to a traditional atom interferometer, we demonstrate the immunity of the CI to vibrations for long interaction times (
>20ms). We characterize and demonstrate control over the two largest systematic effects for a high-precision measurement of the fine-structure constant via photon recoil with our interferometer: diffraction phases and atomic interactions. Diffraction phases are an important systematic for most interferometers using large-momentum transfer beam splitters; atomic interactions are a key concern for any Bose-Einstein condensate (BEC) interferometer. Finally, we consider the prospects for a future subpart per billion photon recoil measurement using a Yb CI.