It would be nice to see a few pictures of your current set up with the rear loop and seat, and oil tank. The measurements you have taken have your rear tire within 3" of the bottom of your frame loop and flat seat? That's pretty close I would say... Now if you add longer shocks, that will affect your rake and trail, which for a race bike will give you a bike that will turn in quicker, but on the street may translate into 'twitchy' handling. Whenever you change one end, it is always good to change the other as well. This means raising the front end, by either lowering the forks in the triple tree(which you probably don't have any 'extra' above the top triple tree to do this with), or by adding a lower profile rear tire... you won't find an inch lower rear without changing rim sizes, and even then the 16" rim will have about the same tire height if you go with the fatter/taller 16" tires out there.
So, what you have is a compromise, in what you are able to end up with. The least hassle is to add the 14" shocks, and put up with the modified rake/trail, and try to get used to the handling... or, do the shocks and install longer fork tubes to balance out your bike. It will end up 1" taller front and back, but your rake/trail will be close to stock. Let's see what you have, first! Post those pics!!
Charlie