It depends on how you cut it down.

Removing it from the gearbox, cutting the threaded end off it, then machining the end to a parallel diameter, and putting a thread on the new end would work fine. Most people just cut a section near the bottom (so the cut is hidden by the shifter boot) they then reweld the shortened end back on. This is less safe and not really recommended. I did this on my Stumpy skyline box and never had any problems. Remember to remove any nylon bits from the shifter before welding back together. Otherwise they will melt, and you'll need to find new ones.

As for shifting knob. Take your shifter with you when buying a new knob. That way you will be assured to buy the right one.

Chris.