I have figured out how to stop the flickering shadows. Remember this is the A7 Engine, so you may not need to do this.

First: Create your model - LOD 0
Second: Create a lower poly 2nd model for LOD 1
Third: Create a third low poly model for LOD 2, but scale the model down about .05, so it will be 95% of the original size.
Fourth: Use shadow_lod = 2 so the slightly smaller model is used to cast shadows. This model is never actually seen in my game.

Result: The shadow polygons do not intersect the actual model polygons. It casts and receives shadows, but there is no flickering!

If you wanted the extra LOD step, I guess you could do this with LOD 3 instead of 2. In this case, make sure your shadow range is low enough that shadows will not show on distant LOD 3 models (or you'll see them flickering)

If this is fixed in A8, no problem, but I thought it might help others with the same problem.