XMarksTheSpot was the modder who figured it out back when we were working on the Lore Creature Expansion. I'm going back and forth with him in email right now about it. He imported the animations into 3d Studio Max, edited the heights, and then re-exported them back to kf files... we're trying to figure out how to accomplish the same thing in NifSkope right now so I don't have to bother re-installing 3ds because I don't have the HDD space for it at the moment... but if I can't get it figured out I might have to resort to getting rid of things to make room for 3ds and use that.
The problem is that each kf file has an average of 100 different interpolator blocks... if I have to change the Z field for every one of those then that's going to be an insane undertaking (28 files times 100 blocks = 2,800 manual field edits), plus I have no idea what to change it to.

MMM Has small imps flying just as high as the larger ones??? Are you sure??? I had never noticed that... I'm wanting to make an imp that's only about 1/4 the size of a normal imp but that flies at the same height as the player's face, and I don't remember ever seeing that before... also with an animation like that, it would also make it possible to have normal-sized imps which are flying 20 feet above the player - might make it interesting for the player to have to deal with sky imps raining destruction magic down from above.