On the bright side the flange angle issue is fixable, but it seems like the upstream o2 sensor ought to be mounted in the header, like it is on my 97 LS.

If you're looking for the best possible performance, I'd fix this problem at the header.

Buy an unmolested header for your specific model year. Then using the stock springbolts and doughnut gasket, bolt up the Carsound cat. Lastly, trim or extend the exhaust system as needed.

Later on, upgrade the cat-back section.