2001 Vitara 4x4 spacer lifted 2".  Sway bar now in a tight bind. Any way to fix this? Remove sway bar? What will removing the sway bar do to off roadability?

The question is, or should be, what will removing the sway bar do to ON roadability.

The sway bar, also known as the "anti roll" bar, reduces side ways movement or roll of the vehicle - it's essentially a spring that only takes effect when the two sides of the car move independently - off road it reduces the suspensions ability to articulate independently, which can cause, for example, one wheel to not extend to follow the ground, resulting in a potential a loss of traction - removing the sway bar generally improves articulation.

In an on road scenario, where independent articulation is generally not a requirement, removal allows the vehicle to roll more in a turn, potentially causing a loss of traction and control - personally I have driven my GV (which is lifted) both with & without the sway bar, and since I spend more of my time on road, and the vehicle is also driven by other family members, the sway bar remains on.

So how do I get it from binding up. I had to use a Jack to get it to a point where I could get the nut on the link, then wrenched it in from there. I don't see the links lasting very long with all the pressure on them now.

Currently I have done nothing to relieve the stress on the end links - to refit the end links, I unbolt the bar mounts from the frame, hook both end links up and then rotate the bar back into position and insert the mount clamp bolts - one approach I have seen pictures of is a spacer that sits between the frame and the mount moving the mount point down (away from the frame) and back (along the frame) - I suspect this would require either countersunk or recessed bolts to secure the spacers to the frame.  I've also seen someone fabricate a "more beefy"  end link from steering tie-rod ends.