I used a rotary tool... The spacer is aluminum (at least on the 68 200) and a course flap wheel ate it up without too much problem for me. I think I needed to take it out less than a quarter inch... just enough for the butterfly flap to clear and a bit more.
I really lucked out with getting a carb. I paid $25 for the new rebuild on Ebay about a year ago. I'd suggest keepin an eye out for them there. I'm sure you're not on right now, but I see that there is another carb that was made for those 170/200 motors:
http://cgi.ebay.com/ebaymotors/Ford-...QQcmdZViewItem
There were a few models that Ford used for those engines. The RBS that I used was actually to a 72 250 from my Mustang. I put the new carb on the 72 (I bought the new one for the sole reason that it was cheap, I didn't really need a new one but I figured I wouldn't look a gift horse in the mouth) and had the old one sitting around before I figured "why not" and tried the swap on my 68 200.
Other places that I looked for a new RBS looked like it ran about $150 or more without a core...
As far as your link. I don't know what to tell you. A "small" 2 barrel might work well, but I would hate to put that spacer on (will clearance be an issue?) and a new 2 barrel, only to find that everything behind me gets painted black.