I'm not a Ballistic fan at all. Never had any personal experience with them but there's enough drama there, I'm not interested. There are mucho better vendors out there with similar products so you can avoid the alleged questionable practices and customer service issues with Ballistic.
That said, I totally agree with Tacoma on the shave kits. Why? That's a BUCKET of work for 2.5" (not that that's insignificant---that 5" of tire size difference) on a burly housing. I assume you're using this in the rear as your parts list doesn't include knuckles and whatnot...? I have had excellent luck with just "smoothing" the bottom facing issues on my 14 bolt. It's only hung me up once (and I had diffed the front at the same time) that way. I basically just cut the lower lip off almost into the lowest bolt in the cover and ground as much as I could smooth. I do hear it slide over stuff sometimes but mostly I don't notice clearance of the 14 bolt at all.
I did run a spool for about 4 years. In some ways I like it better than the Detroit I run now but in other ways the Detroit is mucho better (street driving is SIGNIFICANTLY better and sometimes the Detroit is handy to be able to turn on the trail vs. a spool). The spool is brutally reliable (not that my Detroit has had any issues) and you can beat on that thing until your axle tubes come apart (something to worry about with the 14 bolt). Detroits aren't exactly known for failure in a 14 bolt either, though.
I wouldn't bother to spend the $ to change bolt patterns as I assume you'll have to do that to the front axle as well? Why not just run 8 lug? Cheaper and parts are available everywhere. I like having access to "off-the-shelf" parts rather than custom stuff. Might save you a few days wheeling on a trip vs. waiting for brown Santa to show up with parts for you?
On that same note, I don't know that I'd narrow the 14 bolt to 60"? Isn't it 64" already? Just run some OEM type offset wheels and wheel it. If you did need to narrow it, I would just cut it to whatever the short side axle length is so you can easily have a spare out of any junkyard USA and get back to wheeling if you did happen to break a shaft.
Disc brakes would be sweet. The newer axles like you have or can use late model discs with the integrated OEM e-brake. That said, I'm still running the 150 lb per side drum assemblies and am more happy with those than I suspected I would be.
I like the 14 bolt. Cheap and reliable. Huge and reliable. Heavy and reliable. Cheap and reliable. Access to replacement parts if you do break it is likely second to none. Did I mention the 14 bolt is incredibly affordable and strong. It's also really heavy and reliable. I don't know that I'd customize anything about it unless you wanted to run disc brakes. The shave kits just don't seem to be worth it to me? I see the 14 bolt as a burly version of an XJ. Excellent rig if you keep it within it's limits. It CAN do anything you want it to do but there might be better options if you're going to heavily customize it. It CAN be heavily customized and serve very well, but you might spend less $ if you started with something else (Dana 70 maybe?). If you're going full custom but I don't think a 14 bolt is worth the effort to do a whole bunch to. Did I mention you could build a 14 bolt on the cheap and save some $ for upgrades somewhere else on the rig?
My opinion: The 14 bolt is a great platform to build from if you just want to sling it under your rig and hit the trails. It's cheap and reliable. and HUGE. I'd grind the lip off so it doesn't hang you up and wheel the shit out of it's 8 lug goodness. Keep an eye on the axle tubes where they meet the housing. If you have issues, it'll be there. I'd save the $ on the rear axle and throw that money to the front axle, steering or gearing in the case or something.