Yes, raising back up to the same hieght is a safe bet. While your at it, the exhaust port can be widened out some too. Take a good look ar the bevel on the stock port edges, you will want to reproduce this on the enlarged port.
Your transfer timing will be reduced by removing the gasket, idealy the transfers will need to be raised and or the port openings inlarged. But this is a bit tricky compaired to the exaust port. Intake duration will be extended a bit by dropping the jug, that is in your favor.
Your right about the tighter squish helping to prevent detonation and cool hot spots on the piston.
It is good to check the squish all the way around, sometimes they are not even side to side/front to back.