I just bought a 99 softail night train and it has a lowering kit. I want to drop it more. When I look under the bike I see the two shocks, they've got some holes in the back of it that look like a special tool might fit into it. Am I right....or do I just lower it like a tie rod end on a car????

 

The holes in the shock adjust the preload and dampening. They wont alter ride height. How much do you want to lower? How much is it lowered now. It sounds like you want to be in the weeds. I would suggest and air ride system. They can be dropped for parking and slow riding and raised for comfort on the highway or 2 up.