From your Avatar it appears you have a 97 Red/White Valk. This part of your descripton:
"I also noticed the biting point was getting further from the bars."
...has me thinking it might be the rivets in the damper plate. The 97/98 models seem to have had more problems with that than most others (perhaps just cause they are the oldest). I had the same problem with my 98, perfect fluid and lever. Pulled the clutch and none of the rivets were broken/gone but they were all notched. I could rotate the two pieces of the damper plate probably near a quarter inch. Just a matter of time before rivets started shearing off. The rest of my clutch pack was perfect so just replaced the damper plate (for about $40 I think at the time). Wasn't that big a job really and there is plenty of information on how to do it without special tools right here on the board.
It is about $50 US now, #6 in this diagram:
http://www.hdlparts.com/fiche_section_detail.asp?section=2552057&category=Motorcycles&make=Honda&year=1997&fveh=132667You may also need a new cover gasket if yours gets torn up getting the cover off.
But like others said here, check the simple stuff first. If your fluid is old and dark, change it. If your lever bushing is worn or the pin that it presses against is worn, replace'em.
Good luck