Still pondering over questions raised by this. I don't think I'll ever have an answer for the biggest question, which is: Why did someone go to so much effort/pay someone to go to so much effort to make this Raleigh frame into a smaller frame, rather than have a custom frame built?
The colour is puzzling me though. The frame was built in December 1988, so I assume it was a 1989 model. However, I can't find any examples of Raleigh using fluoro colours before 1990 ... and even if they did use them a bit early, you would expect that to be towards the end of 1989, rather than a bike built at the end of 1988. The orange inside the bottom bracket is very bright and matches the fluoro they used on the White Lighning in 1990. It's possible it was professionally painted after the modifications were made, but the orange looks very much like original paint, with no evidence of any previous paint.
I was thinking about the missing RALEIGH stamp on the top of the seat stays. I don't know exactly the process a frame builder would use, but I assume this would be from shortening the seat stays. That leads me on to another question: If the frame builder was shortening the seat tube anyway, why have the arrangement with the extra triangle to reduce standover height, rather than just have a shorter seat tube?