As you mentioned, there is not enough clearance between the exhaust and bolt. I have heard another solution. Take nut off, push bolt up, pry out bottom bushing. Using punch or simular tool pry out top bushing (bolt still in), this should give enough play to wedge bolt out and new parts in. Not sure if this will work, I will try.
As for the cut the bolt off method. I may need to do this and if so, I will drill small hole through bolt and use retaining pin to ensure if nut does loosen the bolt will not fall out.
Thanks for the valuable info,
I will attack this week. As I mentioned I stopped because I was affraid I would damage the tube welded to the frame.