Cutting the stock rear upper control arms with it dropped that low likely wont do much. You really just need to pony up and buy new rear upper control arms.
There are tons of different companies that make them.
http://www.projectsilvia.com has most of the name brands while
http://www.splparts.com has their own. Pick the one you like best but I don't think anybody here would complain about spl products.
I don't think you need bushings AND a new arm, unless your suspension bushings are due for replacement anyway and the ones you need shouldn't be that much.
I don't understand why people slam their car to the ground without knowing anything about suspension...