On the hubs I have the 4mm spacer is removed from the non-drive side, so I can't see how that would cause the freehub or cassette to foul the frame. If the smallest sprocket is fouling the frame, you might be limited to a larger small sprocket. I like 13->26 as a cassette anyway.
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thanks, taking the spacer from non drive side will mean re-dishing the wheel drive side which is not recommended as it makes the wheel weak on the already steep dish. Thats why they went from 126 to 130 mm when increased from 7 to 8spd+
it would otherwise be an easy solution, thanks