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You just need to cut the downwad part. Unfortunately, after the mod, the infinity focus is off by ~0.2mm (ya, that small). If you have a second body, then you can do a further mod to achieve infinity focus (if you're interested i can show you). This mod will reduce the registration distance of your body accordingly so it will affect your K-mount lenses (the K-mount will focus a bit beyond infinity when you manually focus to infinity). I think it won't affect autofocus, but i'm not so sure.
As for me, I do the infinity focus adjustment on the lens itself. I've done it on the Planar 85/50 and the Distagon 35/28. The Distagon is easier to adjust, while the Planar is more difficult. The Contax Planar 85 has double helicoid design so you screw it up, it might become a real mess.
To distinguish between the AE and MM, you have to look at the smallest stopdown number. If it's in green, that would be the MM version. If it's in white, that's the AE version. Currently, the best price for a Planar 85 would be 450, hovering more around 500ish all the way to 600 on ebay. Most of the AE i've seen were made in Germany, while most of the MM i've seen were made in Japan. There is a myth about the German-made being the superior one, though it's not true. That's why sometimes you might see a very high price Planar 85 simply because it's a German-made version.
The symptom that you describe for the CZ is known as "Curvature of Field", which is displayed noticeably on the Distagon 28/2. The "focus shift" is another issue, and only happens on the Planr 85/50. Mr. Chambers did contact Zeiss about both of these issues, and they were confirmed by Zeiss.
The issue is not as bad as it sounds. You just don't see any improvement from f/1.4 to f/2.8 as a result. Mr. Chambers recommended to focus at f1/.4 for f/1.4 shot, f/2 for f/2 shot, and f/2.8 for the rest.