It is an amazing job to do .... everyone has war stories about doing this. I have done several.
The last one I finally used a grinder (OK bad mechanic) and created a little cut-away to have the one tube be able to clear the other.
Regarding your question: "Does the lower tube rest towards the top or bottom postition when it is installed?" As I recall, the lower tube rests towards the block, the upper is coming fromt he turbo.
Does this help?!?
'03 E320 Wagon-Sold
'95 E320 Wagon-Went to Ex
'93 190E 2.6-Wrecked
'91 300E-Went to Ex
'65 911 Coupe (#302580)