Welcome xskane! Let's see some pics of your new bike! Congrats on the price man, sounds like you got a steal!
Let's see if I can help out a little too.....
1) Lowering - Check out this link for a little info on lowering the front
forks.
http://www.xs400.com/forum/showthread.php?t=4553
2) Shorter shocks - The Honda Rebel 250 shocks will bolt up with minimal mods. I believe they are around 2in. shorter than stock shocks.
3) Kiskstart only - Converting to kickstart is simple...just remove the starter.
4) Wiring - There are many diagrams available to you right on this site for minimal wiring needs. Just do a quick search.
5) Battery - As bcware already mentioned, running without a battery is damn close to impossible, but it can be done. You will have to do the Banshee charging system mod to switch to a permanent magnet style set-up. It has been done, but only a few people have done it. Perform a quick search here, and you should find what you need. If running kickstart only, you can use a much smaller battery, and again, as bcware mentioned, you can find multiple places to hide it on your build.
Good luck man! Let's see some pics!!!
#