http://imageshack.us/photo/my-images/202/screenshot300.png/

http://imageshack.us/photo/my-images/19/screenshot310.png/

Normally this is a two-handed axe (credit goes to Thann for building it), but I prefer being able to use a shield, so now my weapon is digging into my right pauldron (and inhibiting my sight to boot).

Basically what I'd like to know is how to adjust how the axe is held so that it isn't clipping (at least not so much, I know it is pretty huge), doesn't grip at such a high point on the handle, and doesn't block as much of my view in first-person mode.

Hopefully my feeble modding skills will suffice, if not, I guess I'll find another axe.

You could try changing the type of weapon classification to another type as the game will treat the weapon as a different type and thus views , animations , and the way it is held will be affected , sounds associated with it too. Find the axe in the construction set under the 'weapons' tab click on the name so that a box pops up which allows you to specify what type of weapon it is and change it to blunt weapon , short blade etc and maybe you will find something that you like.