I don't use a dremel as I've never had good success with them - too much heat. Instead, I just take some bone cutters and cut down the sharp points and excess dead skeleton. It doesn't have to be totally smooth, but just enough that the coral tissue doesn't get ripped on a sharp point. I only remove some of the dead skeleton once the coral is on the recovery, not when I first get it unless the skeleton has algae, etc on it. I'd say 2 weeks is about ideal for many of the corals I've taken in.
My recommendation is that if you had the coral before it started receeding, and it's now healing, I wouldn't worry about the skeleton. Corals that had some trouble in your system and are doing better now have a MUCH better chance of recovering fully than ones from another system. If you're only talking 1/4" as well, I don't think that's enough to worry about either.
The scoly on the first page is a prime example to me of when to smooth down some of the skeleton. Acan's & Favia's usually don't need too much work done to the excess skeleton since their skeleton doesn't have giant spikes - it's really only important with Scoly's, Trachy's, etc.
Just my $0.02
