I personally dont see the need to trim the prongs. I don't like doing this. Since this is a single cam, you may want to try setting the nock a little higher. Unlevel nock travel may be pushing the arrow down on release and you're getting contact. Also, have you checked the timing of the cam?

I still suspect contact. If you elimanate that from the equation, then I would look at the drop away timing. If the rest is dropping too quickly, there may not be enough support for the arrow and allowing it to come off the bow tail high.

If the tear is as big as you stated, there is definitly something umuck there. Keep at it, you'll probably figure it out and realize it was something real simple. The TT is an extremely accurate rest.