Is there a way to lower the height of the iMac M1 stand 2-3 inches?

The M1 iMac's stand is not removable or adjustable.

The only way to lower is to order the M1 iMac with a VESA mount and use an aftermarket stand or arm.

see < Buy 24-inch iMac with Built-in VESA Mount Adapter - Apple

If you purchased that iMac M1 from Apple with in the last 14 days, you can return it and order a VESA mount model.

see > Apple - Legal - Sales Policies - U.S. Retail Sales

I wish to lower the height of the stand by 2 to 3 inches for ergo reasons.

That might shorten the life of your iMac. For years iMacs have taken in cooling air through slots on the bottom edge of the case. The ~3 inches of clearance you now have between computer edge and work-surface must remain so the computer will not overheat.

This picture is from an actual post here a couple of years back. The owner could not understand why his iMac was severely heating and shutting down:

Even if you get a VESA-compatible iMac or one of the stand-clamping VESA-like mounts, you still must not block the venting. That may mean hanging the computer over the edge of the workstation, or a lower workstation. Respect that three inches of clearance regardless.

+1 to Den.Theds explanation, is spot on. Your choices are:

1. A different desk (you may want to consider a standing desk) or
2. Return the computer to Apple (assuming you are within 2 weeks of purchase) and buy the VESA mount iMac.