I'm assuming you will cut the hose eventually, but that is actually a really smart way to route it (around the post like that). I never thought of doing that. When you have it all the way down and you bottom out the shock, the hose won't hit the tire that way.
I actually won't cut it. If you look at the pictures of my bike when I had the KS on there, I did the same cable routing. I prefer to leave it this length and route it like this for two reasons: 1.) it will make it easier to fit on another bike should I ever transfer it, and 2.) routing it like this makes it so that the hose does not rub on the tire when the post is all the way down, as you noted.