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It just says level. It measures in tenths of degrees

yes, shimming down is common

You could lower the tcase, but you might need to shim the axle instead. That would be my first option. IMHO better than lowering, but both acceptable

That is correct. YJ slip yoke is 1/2" longer and will accommodate more bend than the XJ yoke

If you have a smart phone, you can get a free app for leveling

Here is how to get that sorted out

http://www.xjtalk.com/showthread.php?t=7299