in the imco 1',2" and 3" shorty lower units what is it they do to modfy the drive to make it shorter?

It is a whole new bottom casting.
The bottom casting is shorter.
I am running two of the 2 inch models.

The original ones were cut down. They took a stock casting, cut 2" out of it, shortend the vertical shaft and welded it back together. They then added a nose cone.