Yep - countersinking (or very low height cheesehead bolts) are needed otherwise the bottom case will foul them when you put the plastic case back on. They are not needed if you do lawdawg's mod instead.
Cutting the GPU h/s is a little tricky, try using some heavy duty side cutters to just snip the fins (they are only soft ali) then hold them in some long nosed pliers, rock back and forth a few time and them will snap off. Once you've made suitably sized areas for the nuts, then straighten out any fins. It won't look great, but it'll do the job....
An alternative which I've just been thinking about is to just drill suitably sized holes into the DVD case (obviously take the innerds out of the case first..

), so the nuts can sit ONTOP of the fins (with a large washer to spread the load over 3-4 fins) - this will be a lot easier than trying to cut out the fins .... not sure if there is room in the DVD drive though .. hmmmm... will have a play over the weekend ...
I was thinking that too. Not about the dvd drive. But its easy to get the fin right about the hole in the GPU heatsink off. So I was thinking of clamping it on like that, get a slightly longer bolt and a larger washers to clamp it down from the top of the fins. Because I couldn't get the fins off nicely/easily.
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