Shortening this distributor is going to be tough because of the flange where it mounts. You can't just machine the existing piece.
You either going to have to cut out a section and weld, which is tricky because the bore has to stay really straight and aluminum warps easy when welding, or make a new housing from scratch, maybe not worth it.
Also the shaft is hardened at the oil pump drive end you would have to shorten it inside if possible.
Are you sure you even have an inch clearance down around the main body of the dist?
Have you looked at a clearance bubble in the firewall?