Several things gentlemen:
1. Shortening a barrel will lower velocity a little.
2. You DO NOT need to use a faster powder. Use whatever powder gives you the best accuracy results in a longer barrel.
3. Recoil won't be increased much; i.e., hardly enough to notice, by shortening the barrel a couple of inches.
4. You will get a complete powder burn in a shortened barrel even with a 30/06 provided you don't do something really crazy like shortening it to 2 or 3 inches.
5. Anything you do to an Encore or Contender barrel, unless done by the factory, will probably decrease resale value. That includes Krylon pain, adding muzzle brakes, etc. Just because you buy a barrel for $200, have it cut down for $50, have a muzzle braked installed for $75, doesn't mean your barrel is then worth $325. It will still probably be worth no more than $200 and maybe less when you get done with all that depending on how well the work was done and by whom.
Since my Encore and Contender handguns are scoped, I don't wish to have iron sights hanging out there. For this reason, I've had more that one barrel shortened to remove the front sight holes. Said shortened barrels include a 308 Winchester and a 7mm/08. I have no regrets and, in fact have a new 30/06 handgun barrel I may do the same thing with. SSK Industries does good and prompt work but I generally send barrels to Thompson/Center since having them work on the barrel doesn't void the lifetime warranty.