I have hear of the conversion and I think i will be doing this in the future. The rear struts would make since to me considering the weight of the MR3 is the rear based on its engine placement (not 100% sure if rears or fronts are supposed to be used). As for the modifying, You just need to measure up the old and new strut and take the difference out of the strut tube. You cut the tube in the middle (40mm?) so you can retain the threaded part on the top and all the needed parts on the bottom. Then you weld together and instal your shorter stroke MR2 strut absorber and weld on a perch for your coil spring. Assemble and BAM! you made yourself some coilovers.
I am not 100% on any of this, so if anyone has more to add or correct, by all means.
1974 TE27 White #1
1974 TE27 White #2
1975 TE38 Brown