HELP! wheel fitment

[bug-er]

hey
Im after a little help and advice off you guys, basically my cars got a set of 16inch porsche rims on it with an ET50. I have bolted them onto the standard drums, using 25mm adaptors, but they stick out of the arches a bit too much for my liking, see pic on www.geocities.com/meteorbug .
My question is what do you suggest i change in order to get the wheels in the arches nicely? ive looked in mags at other cars and theyre alloys are well past the inner lip of the wing.
Im planning on lowering it so the wheels fill the arches but i still have travel and the ride isnt too rough. got an adjustable front beam and standard shocks currently, what lowered shocks do you suggest???
thanks
Adam