I no longer recall what the Kesset haSofer (Siman 7) wrote, but the Shulchan Aruch in Orach Chaim 32:18 - סימן לב - סדר כתיבת התפלין - writes that if letters touch then one may erase where they touch and there's no need to erase and rewrite.
אִם נִדְבְּקָה אוֹת לְאוֹת בֵּין קֹדֶם שֶׁתִּגָּמֵר בֵּין אַחַר שֶׁנִּגְמְרָה פָּסוּל, וְאִם גָּרַר וְהִפְרִידָהּ כָּשֵׁר, וְלָא מִקְרֵי חָק תּוֹכוֹת מֵאַחַר שֶׁהָאוֹת עַצְמָהּ הָיְתָה כְּתוּבָה כְּתִקְנָהּ
Obviously, there are lots of minor details, but that's the general rule. E.g. if their shape is now altered they need to be erased and rewritten.
What I'm wondering about your definition of Hiddur is: Isn't it more Mehudar to have a tiny erasure at the point of contact, as opposed to erasing 2 letters and writing on less-than-perfect parchment which tends to be "messy".