Need advice on 68 dart new rear shock fitment

I've put that inboard relocation kit into 2 Darts now and never ran into that problem. Are you sure they sent you the right new shocks? When you say you moved the rear end "back 1 inch" do you mean toward the back of the car in addition to moving the springs in?

One more thought, are you trying to put them on with the whole rear axle hanging from the springs? If so put something under the rear axle and jack it up in relation to the body... That's the way it is when the car is on the wheels, even in a serious jounce the axle would never hang down that far.