RE: Question about modifying a jug
Yes it will change you port timing, in most cases for the worse, and the gains in compression won't fix the fact that you reduced your exhaust timing and will get less RPM. My opinion would be to leave it. New ring, advance the timing, larger carb, open exhaust and you will have a nice engine. If you want to run in the 8500-10000 rpm range, then experiment with opening and raising your ports.
PS-please post your experiments and numbers though, we all want to learn at your expense-HA!