Is it permitted to cut metal? If Without leaving sharp edges
Yes; you are allowed to modify all vex parts with the exception of most electronics.
Yes, but some tournaments can be very strict with sharp edges. Sand or dremel everything down before the competition.
Great thanks 
This might not be legal but you can put electrical tape on the edges of the but pieces so that they dont feel it as rough
I wouldn’t consider that legal. If you used VEX-official/identical adhesive foam or Velcro though…