You're definitely right that the rear suspension binds up at full droop. I hadn't thought about the bushings having to flex sideways, but that certainly doesn't help. What amazes me is that, from what I can tell, the bushings are bonded to the inner and outer sleeves so they have to flex just to pivot normally.
However, you don't have to compress the springs/struts to get them in, even with a 1.5" lift, so I don't think that really limits travel.
Also, a flex pit isn't going to compress the stock springs and struts close to full compression, or you'd be bottoming out constantly, so that isn't going to show the full extent of travel he's getting.
Northcoast - I like your rear bumper/tire carrier/plastic bumper trimming.
I built that bumper and did the trimming. It works , but was based on a bushing instead of a bearing, and I bet is loose now! lol