My initial thought is to just cut the tube part way up and bend it over to the vertical tube and reweld.
The frame in the picture looks good, but your above quote worries me a bit. Don't actually "Bend[/b]" the tube. Once you bend a tube it starts to loose it's strength. I'm sure you knew that and weren't going to actually bend it, but I felt it should be said. 
Bend is so ambiguous, I was planning on cutting out all but a small strip and then bending that and re-welding. My idea was by cutting out a section and bending a small portion that I would keep good alignment and that it would help with placement.
I want to move the frame up a little, I have tried making a mount for the rear-sets, but just can't get it to look right as I would either be placing the rearsets on the outside of the frame, rather than flush with it, or using a large mount to try and align it correctly. Either way I looked at it and worried over it I couldn't get it to look right. So, since cutting and re-welding is an option, I can move the cross member and get the look that I would like.
I will need to gusset it somewhat and I was going to add a smaller diameter tube as an additional frame support. Also, I am looking at a lower battery mount if I can. But not sure on that yet as I would prefer to have it out of site as much as anything.