A configuration slider for the height of an item-holding arm (similar to the ladder arm height slider), either as a modifier of the 'Hold Up All Items' setting, or as a replacement of it. I don't know if this should also affect specified items like Compasses and Torches.
Additionally, perhaps a way to adjust the left-right angle of held items, so that tools can be aligned to the edge of the screen rather than angling into the center of it.