You need to contact Gillafunk. He'll know what to do.
If you're not confident with what you're doing I'd quit right now and take it to the dealership or where ever and have them deal with it. I'm sure they have experience.
Cutting to the left of that spacer would get the shock out of the way and give you room to work. There may be enough of a stub sticking out to get some vice grips on it. Heck once the weight of the shock and rear of the bike is off the bolt may come out easy. (Ever hopeful) There's not going to be much room in there for an easy out. I'd rather try to weld a nut onto the bolt and try that first. The heat from the welding should take care of any loctite in there. I've never put locktite on that bolt myself so who knows.
That bolt is under a lot of stress. I've had mine bend a few times. I discover it when I'm taking the shock out for some reason. Some guys that ride a lot harder than I do off road complain of bending that bolt a lot. Some of them even replace the bolt with something harder. I figure it's easier to deal with a banana shaped bolt than a broken one like that.
Good luck man. If everything goes south a swing arm from Beemer Boneyard is $185.