If you have fairly wide curves (15 inch is enough) they really don't need the side play. There's enough slop in them, or working N couplers, to allow the cars to go through curves.
That said, the only time I used one of these I did just what cjm413 suggested - drill out the hole and mount with a 00-90 screw. if there's too much vertical play, a small washer will keep the coupler straight, but I didn't have a problem with that.
If you use the hole closest to the coupler, there's no reason you can't cut the extra off, but leaving it on will help keep the coupler from sagging.