You're right about the lower arm being more or less level with the ground when everything is hooked up and the suspension is loaded. When you cut a spring, you raise the spring rate of the spring and make it stronger than it was even though it may be a little shorter. It sounds to me like you are starting with the totally wrong spring for your application.

Check out this selection from the experts, 23 different springs just for the MII setup. Dial these guys up on the phone and tell 'em what you have and what you want. They can fix you right up.....
http://www.eatonsprings.com/m2coils.htm