why do you want to cut off your passenger peg stays? Most exhaust systems and rearsets acutally use those to mount (not to mention the centerstand stop on most aftermarket exhaust systems). Is this just a fit of overzealousness or do you actually have a plan for the bike and hanging the exhaust and your rearsets?
of the top of my head I would say hack up a later frame, the earlier frames are worth more.
I plan on going with a minimalist exhaust theme... Either a 4-1 that turns down and out-ish at the collector or the 4-2 that I currently have and turn down and out-ish at the collectors, so I will have to hang them somewhere there in a manner that gives them some limited motion. The details will be created on the spot. As for rearsets, I am going to fab a piece that welds directly to the frame. Center stand? We don't need no steenking center stand. I do understand the usefulness of a center stand, but on this one it has to go.
I would prefer to use a later frame, if there is someone in the Houston area who would like to swap a titled '70 frame for something later (titled), I am all for it.