The pvc pipe coming out of the wall sticks out about 6 inches. Can I just cut a few inches off to make room for the disposal? How do I thread the newly cut pipe?is there a connector?

PVC pipe is usually glued, not threaded. But there are fittings that convert it to almost anything you need. It can be cut back and a new whatever you need glued on.

Remember there is two things you need... #1. A PVC primer you completely wipe the area to be glues and a bit beyond on BOTH parts... and #2 THe PVC glue itself... work fast as they set up very quick once they are put together.

Before you do anything you need to compare the exact height of that PVC pipe with the height of the disposal drain. More than once I have worked on a kitchen where the undermount sink and disposal are not compatible due to the new, much lower trap. Water hates to run up hill and some installs create this situation. IF the PVC is still lower than the disposal trap then you can make you connections. PVC drain and trap are frequently not glued and use a PVC compression connector. So you can go either way, glue them and then that's it forever or use compression connectors. This is how to glue them How to Replace a PVC Sink Trap | Video | Kitchen Sinks | Kitchens | This Old House and if you go with compression then this. Video: Hooking Up a P-Trap to a Sink | eHow.com

Thank you ballengerb1 and smoothy. Fortunately for me, although the new sink resulted in the drain off the disposal being much lower, it was still several inches higher than the pvc coming out of the wall. (Although the disposal itself was as low as the pipe the drain was placed much higher on the disposal). I ended up cutting a portion of the pipe out and gluing the original male threaded end back on the pipe using a connector piece (or whatever its called). So I guess I used both techniques setting up the trap was a piece of cake after that.
Thanks again for the help!

And we thank you for the update. Let us know if we can ever be of help in the future. Good luck, Tom