You are in the realm of reasonable trimming. I would think really hard before taking more than an inch off the diameter, but it would depend on the prop size and application. They will not act exactly like a prop that was built to be 1 inch less diameter, but instead will be heavier and usually have a steeper pitch.
It is a lot of work to trim a box of props, adjust the tip shape, reseal if wood, and then balance. This is the biggest reason against trimming. In reality this is just a 4 letter word, that some consider "dirty": W-O-R-K.
Phil