Yes spacers or if your suspension has them adjustable coil overs should be used to level the rig, then the KDSS screws set. Literally pushing an otherwise unlevel rig level with the sway bars and KDSS puts forces on the system it wasn’t designed for.. or at least not for those timeframes. And if you check my KDSS anatomy thread you’ll see it may lock out some self-balancing function within the system.
@linuxgod is doing a good job helping you with alignment, but I did have one thing to add.
The arb arms aren’t adjustable themselves, they simply move the upper ball joint position so that they return the wheel alignment closer to factory specs with the common amount of lift we run. This is necessary because the camber and caster change with suspension travel. This means there is in effect an upper limit to how much we can lift the vehicle and get an ideal alignment with arb or other static arms (depending on how much they alter bj position from stock) .. spc with adjustable upper ball joints addresses this, but most people don’t lift high enough to truly need that function. Some do want the adjustability at the top, but as stated IMO it can come with other sacrifices.