Is it the regular AO/3-in-1 or the Elite version? I ask because the Elite version has much taller bottom slots, for some reason.
In general convertibles don't fit many newborns well from birth, but there are some exceptions. Some seats have very low bottom slots (Cosco Scenera) and fit a newborn well, some newborns are just long-torsoed and fit better in convertibles.
The reason a baby's shoulders are supposed to be at-or-above the slots when rear-facing is so, in a crash, baby does not "ramp up" the seat too much, possibly exposing the head and possibly coming out of the harness. If a convertible seat has very high bottom slots that are very far above baby's shoulders, baby will move more in a crash.
However, if the lowest set of slots aren't TOO high above baby's shoulders (say, an inch or less), it should be fine.
If the seat is too wide to fit baby comfortably you can use rolled up receiving blankets on each side of baby. NEVER behind baby or under harness straps. Never use aftermarket accessories like head supports, either--nothing that did not come with the seat that could interfere with straps or the performance of the seat in a crash.