You can just use the stock spacer. You DON'T want the new spring/spacer to be the same total length as stock, it needs to be a little shorter, otherwise you'll have too much preload and not enough sag.
If you want to use the PVC, cut it to the length in the instructions. You can either pull the cotter pin as you describe, use a small straight cotter pin that you then bend around so it fits inside the PVC, or just put one of the washers between the PVC and the cotter pin.
'07 DL650, '01 DR-Z400S, '99 SV650 (race bike), '80 GS1000S, '85 RZ350, '08 Ducati 848