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@thecycleclinic
Lowering the cable is what I would do to. It will lead to a more spongey lever though. On one of my MTB's with canti's I have the hanger just above the tyre, braking is pretty good on that.
Good levers are essential. If using flat bar levers then something like good old Shimano XT2 levers or Dia compe SS7, Suntour XC Pro are all good clasic levers.