Negative Wedge Kit Question

You don't need to cut the coil at all. The Shelby 1" drop (relocating the upper A-arm) will lower the car with 1". If I get you correct, you want to lower the car a total of 2" ?
I'd rather get some lowering coils, rather than cutting the oil coils. The reason is that a coil that has been cut has the right lenght you want, but not the stiffness/softness. You got a say 6" coil with the softness of a 7" coil. There is a good chance you would bottom out on heavy compression.

I recommend 620LB coil springs; I had them before I got coil-overs
http://www.mustangsunlimited.com/itemdy01.asp?T1=GT515+01&Category=Suspension+%26+Steering&subCategory=Front+%26+Rear+Springs&CatKey=EMUSTANG
Also, TCP has some new progressive springs that looks interesting:
http://www.totalcontrolproducts.com/vr_springs.html

You can do a Shelby 1" UCA drop and the suspension will move through its full travel without damaging the upper ball joint. Therefore you can put any spring you would like in the car. The UCA will hit its bump stop before the upper ball joint binds.

Heavier coil springs might not be a bad idea, but you could always cut yours and see how you like it first..

edit: I can't tell you how much to cut, but cut about 1/4 of a coil at a time and then after reassembly drive around the block to make sure everything has settled. The suspension will be too high if you don't drive the car at a minimum around the block. I would recommend you try it out with just the UCA relocation prior to cutting the spring at all.

the 1" shelby/arning drop will NOT lower the car 1", at most it will lower it 1/2" , the lower mounting point simply gives the car a better camber curve do the new position of the control arm, any drop in ride height you get from it is just a bonus. i'd go ahead and do the 1" UCA drop for the added handling benefit and cut the coil springs if you want it lower and see how you like the ride, you can always get a dropped spring later if you don't like the ride with cut coils.

to fully answer your question, you do not need the negative wedge kit with the 1" shelby drop. the wedge kit will allow the upper arm to be lowered 2" though, but it stresses the upper arm right behind the ball joint where it is weakest.

When I did the drop on mine, dropping the A-arm 1" resulted in 3/4" drop of the car. I then cut one full coil (one half coil at a time) to get the car to sit where I wanted. Now that I've put the car on a diet, it sits about an inch and change higher, so it's time to cut the springs again.