can you heat your muffler's header with a torch n bend it away? 1/2" is too much to sand or grind off the crank and dimpling the stock muffler that much is bad too. 3/16" you could get away with it. I had that issue with my road bike, first I tried an extra gasket to move muffler forward, but no dice. then I had the keen idea to make a flange spacer that was thicker on one side than the other to angle it away from a piece of 1/4" scrap aluminum.
budget fix,, I didn't want to file the engine mount or get a wider crankset