Bike is slightly too large, shorten the stem?

I have a slightly large road bike, which I made a good fit by shortening the stem.

You say you have a road bike, yet I don't recognise the image you've posted. I would expect a stem on a road bike to look more like:

Aside from that, you're proposing quite a large change - I think I shortened mine by about an inch. I don't suggest there's any great technical issue here, but just be aware that a small change in length can make a big difference in terms of the feel of the bike.

The only other thing to point out (caught me!) is that any computer you might have mounted to the stem....it might all get a bit cramped. But don't let that change your mind if the shorter stem works, its just that you might end up buying a new computer mount as well.

Swapping the stem may make the riding more comfortable, but you may want to look at other things too

Horizontal position of the seat - most seats will be able to be adjusted forwards or backwards. But if you change the position of the seat, relative to the cranks, you need to think about how this will affect your stroke.

Handlebar width - if the handlebars are too wide you may feel like you are reaching too far forward, when in fact you are reaching too far out. A simple check is to stand across your bike in front of a mirror, put your hands on the hoods, and see how closely your handlebars match the width of your shoulders.

Frame size - it's possible you have a bike that's too big for you. Although this is the most expensive thing to change, after riding a bike like that for a couple of years before finally spending the money on a properly fitted frame, I believe it's worth the money for the extra enjoyment you get from riding.

A relatively cheap way to make the reach shorter without compromising handling is to move grips little closer to you. Applicable on most drop bar handles. Most bicycles have grips set far forward and moving them back 2 centimeters is safe and won't move them up too much. Expenses - new duct tape to fix cables onto place if they are not internal and a screwdriver if you don't have one.

You can get also get a significant change in position by getting a different set of bars. I would look for various handlebars labeled "short reach or compact". Almost all bars these days have listed the drop and reach. If your current bars are on the long end of the scale, switching bars might solve your problem.

Going to a stem that short is going to have lot's of odd effects on the handling of the bike. For a road bike with drop bars, my experience is that 80mm or so is about the shortest stem you want to use.

A bit late to this question, but another option not listed here: flip your stem.

Most road bike stem aren't a right angle, often they are off by ~6°. This means if you flip your stem then your handle bars will come up and back a bit, this will reduce the reach and hopefully take a bit of pressure off the lower back.

Also you could try rotating the handlebars back, this will have a similar effect. Loosen the bolts of the front of the stem a little, roll them back towards your seated position a degree or two, tighten the bolts back up. EDIT: to be clear, I'm only taking about rotating them back by a few degrees.

I did both of these tweaks to my road bike, plus slid my seat forward a tad, made it much more comfortable. (Yes, I may have bought the wrong size frame, I know, but too expensive to fix it now)