or will this put too much stress on my shocks and coils and cause them to fail prematuraly? Id probably only lower another .5'' but i am afraid that this could really hurt my performance on the springs and shocks. Feel free to flame.

BTW- Bilstein shocks with Neuspeed race springs. B5 A4 1.8TQM

i think you're confusing this with the issue that arises when using stock shocks with aftermarket springs. the springs are lower and thus naturally compress the shock more. However with springs and shocks, both are better "lined up" in terms of their travel and compression, no matter the perch setting.