[BigAls87Z28]

First of all, I wouldnt put shorties on anything but a 305 engine....
second of all, as far as emissions, unless you remove the cats, you will have no problems. The cats from the factory are located very close to the engine is because it allows the cats to heat up faster, helping to lower emissions. Moving them down the line shouldnt be a big deal.
C) they should not put anything up your tail pipe. You have an LS1 car, that is OBDII. All they have to do is plug in the little scanner, check for engine codes. No codes? No problem!!
Hell, you could go in there with heat shields welded to an offroad y pipe to mimic catsk, put o2 sims in there, and the comptuer would read A-Ok, and the DMV gorillas wouldnt know the difference!!!
Just make sure the exhaust doesnt exceed 100dB.