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never really heard of it being recommended but probably wouldnt hurt. with a stock truck you wont see much more than 900 degrees at the down pipe adn theres already sheilding on the firewall so you dont really have to worry about it. BUT if you have an auto, the way the pipe comes down it will near touch the feed and return line for the tranny, you can bend them away or put some of the rap on there.
If your careful with cutting you can re-use the stock dp wrap/shield, its just a thin piece of metal wrap that fits losely around the dp iirc but u could re-use it if u wanted. i know i will.
Wow, ya I'd recommend sawzall. I made 2 cuts, one right by the turbo at the 90º bend and one under the truck. I think some can get by with one, just not sure where the cut is. Plus sawzall gets plenty of anger out if you're an angry about fuel prices!