First My Setup:

67 Dart 2Dr HT
73 Spool type K-member
360/727 Originally from 74 Dodge Van
Early Edition Spitfire Tri-Y Headers.
Power Steering Box

Already pulled the full size starter because it interfered.

Second My Problem:

The Header is interfering with the upper portion of the steering box.

Third My Question:

Is there enough material in the steering box case that I could grind a little off to minimize the dimple I might have to make in the header? It might be 1/8 inch or a little more.

I would dent the header before grinding on the steering box. I'm thinking about safety and value of the box "core" as much as short term leaks.

Another option would be raising the engine. Any way to shim up the mounts and gain clearance?

Just me I wouldn't be afraid of 1/8" off the box case. It takes alot of dinging to impact header flow but it looks so unsightly. As said raising the eng slightly may or may not be a good plan in your case (as you know check clearances/driveline angles)