Since the perches and the axle tube are ok, an easy fix might be to weld some 2.5" wide flat bar to the top of the perch so that the block sits on it w/o hanging over the edges. That would be a whole lot easier than cutting off the factory perches and welding on new ones.

Either that or find some different blocks that fit the perches better. Those might be a "one size fits all" block that really doesn't actually fit the Toy axle very well.

'97 4Runner, '06 F350, '86 4Runner, '05 WR450
http://home.4x4wire.com/erik