I'm using 1.25 DOM for a tie rod flipped to the top of the arm on the knuckle. Yes, it does hit the cover and yes it is a serious problem. The solution? Adjust the bumpstops until the link doesn't hit any more. You lose some steering, but I think you'll find that your stops are adjusted just about where they need to be to keep the tires from rubbing any way. If you're running coil springs, you can add high displacement spacers under the Heims to gain a little more height, but if you have leaf springs you'll probably have to run small blocks under the springs to get clearance anyway. I run 1" blocks bolted into the spring packs a la Zero Rates.
I also have high steer arms on mine. I can't use them at my lift (4") because the tie rod will hit the frame on stuff. The 78/9 frame might give you more room, but measure things out before ordering high steer arms, they ain't cheap. I do use the high steer on the passenger side for the drag link and then use bumpstops to keep the frame off of it.
This is clearance to the spring:
This one shows how everything fits. The tie rod just touches the front cover at full steering lock in both directions.: