Looking at the shots from low down I would think that if you straighten that lower rail you will raise the motor quite a bit. Project a line forward from the rear part of the frame and it looks as if it will land well below where the front end is now. Add to that the fact that it is generally a good idea to build a little arch into the frame so that it is straight when under load and you could be opening a whole can of worms. If the car worked OK as it is I would be more inclined to leave it that way. As the straight edge indicates that the top rail is bowed as well It would pay to add a diagonal in the first open bay to stop that from getting worse. Or better still, try taking the motor load off the frame (jack or crane) and see if the frame un-bows at all. If it does, add the diagonal to keep it that way. Alternatively, leave the motor in the car, tie/weight the front end down and jack the frame up at the upright where the frame bows and see if that straightens the top rail and then add the diagonal.
OR, as you are going to re-mount the rear and and move the motor back to the original location as per the earlier discussion you could modify the frame as you originally suggested and then mount the motor at the correct angle (provided that it will fit with the rails higher in that area).
Roo