Back off the preload, too. Your damping is not controlling the spring at this point, if the tire is cupping. Just upping the compression damping might not be enough by itself. You may also want to increase the rebound damping as much as the compression.
'07 CPB Blue; ZGST windscreen with MRA X-screen adjustable spoiler, tube bar adaptor, PC III, ATRE,BMC air filter, modified stock seat with 2nd Look cover,Scorpion Flame Ti slip-ons, Galfer rotors front and rear, braided-stainless lines, C-F 10R front fender, C-F hugger, C-F inner fairing panels, painted foreman's fins with faux C-F inlay, polished rim lips wired for heated gear and accessories, Givi V35 side bags and E41 topcase with SW-Motech qd mounts