How can I lower a dirty arm trap drain(outlet) to accommodate a lower sink?
I ended up following Alaska Man's advice and lowered the sanitary tee.  After installing the new sink and the disposal, it was obvious that my only option was to take the sanitary tee route.  The good news was that I did have access to the other side of the wall so getting at the tee was simple.  The unfortunate news was that I really only needed to lower the DWV about an inch.

Here is what my disposal looked like after install - showing the DWV too high by just a bit.  The after shows how far I lowered the DWV.


On the other side of the wall, this is where I lowered the sanitary tee about 3 inches total.