Thanks QTLA and Rocmoc - good suggestions. I have considered that. I looked at the weight rating of 12" car tires and the best I can find is 805lbs max load. The tent trailer dry is about 1200lbs plus about 200 lbs of extras. I don't think the car tires would hold up even if I can find them, but maybe there are some more heavy duty 12" car tires?
My other thought is to swap them out for 13" wheels and tires if I can find a close profile on the tire height. A 24" outside diameter tire will clear the edge of the fender well by only about 1/4". The trailer tires are 23" OD. The trailer hubs take a 4 x 4 bolt pattern wheel so I would think I could find them. The fender wells are basically inside of the body of the trailer rather than external fenders. The tire clearance is actually figured from the center of the hub to the closest part of the main frame so that will be a bit difficult to adjust :)
As you say Rocmoc - if we can't figure out something, the local people down here can make it work. I have even considered swapping out the torsion axle for a regular leaf spring axle for more tire clearance.