What is the shortest barrel I can mount on a preban ar15 to keep it legal since it is not registered as a pistol?

16 inches unless you register it as a Short Barrel Rifle.

How would I go about registering it as a SBR? Thanks in advance.

First you need to check local and state laws.  Some states like Missouri require a Curio & Relics license to own a SBR.  Other states like Alaska, no license is required.  

Then you need to fill out BATF Form 1 (Application to Make and Register a Firearm), then you need to have the Chief Law Enforcement Officer (CLEO) of your area sign off on your application.  Sometimes that is the toughest part is getting someone to sign off for you.  Then you send it to BATF along with your hard earned cash ($200) and wait.  Could be a month or could be 5 months.  Wait till you get the papers back before you buy the barrel.  If you already have an AR they could slap you with a conspiracy charge for having the components to manufacture an unregistered SBR so you're best off to wait.  If you have Adobe Acrobat, you can download a Form 1 pdf from ATF at [url]http://www.atf.treas.gov/forms/pdfs/f53201.pdf[/url]

Here is a nice adobe site, that you can click on and fill out your form all nice and typed.
[url]www.titleii.com/[/url]
If your lucky or live in a rural area your CLEO will sign off no problem, hell my CLEO did'nt even read the Form just signed where I showed him!  'Course I've known him for a long time too.  It's a good idea to fill out your fingerprint forms in triplicate in case one is smudged.  These are available from the ATF Distiribution Center as are Form 1's.  Here's the address.
ATF Distribution Center
PO Box 5950
Springfield, VA 22150-5950
These forms are free upon request.

Thanks for all your help. I am ex local law enforcement and just got my FFL so the signature should be no problem.

Brian