I'd leave the washers because the trans rear will nose more down which will increase the angle.

Right now, the trans is down 2*. To get the pinion so the angle is "0", you need it UP 2*. That gets it parallel with your trans output shaft. From there you roll it down whatever you need.

Another way to figure out if what you are working with is pointing up or down. When you get your reading, pivot the angle finder so it's at "0". If the opening of the V created is up, then the item measured is pointing up, Opening Down, it's pointing down. In your case both items would pivot at the top point creating the opening of the V at the bottom or down.