Thanks for the replies. Yesterday I checked with a local trailer dealer - everything from car to utility to cargo to horse, etc. They've done some work on a couple of my trailers - as well as some plumbing on the motorhome - and have an excellent reputation.
I showed them the paragraph from the Itasca manual that specifies a 4" drop and they were unanimous that a) they had never heard of such a limitation and b) if someone had a problem it was likely with a defective hitch and not anything to do with the amount of drop. They regularly sell and install dozens of longer drop hitches and have never had any problems. The only obvious caveat is to be careful of steeply sloped driveways.
So we'll hitch up the dolly, load up the V Dub and head up the road to the Black Hills!
Thanks again for your replies!