See if this does what you envision.
It was necessary to clean the Item #s list. There were repeating spaces. The COUNTIF in the self diminishing list won't work without that step.
I worked this out in the Testing sheet. All the stuff is there.
In Q3:Q12 I made a clean copy of the list in the Position 1 sheet of Item #s.
In R3 I entered this array-entered formula and filled down to R12.If you aren’t familiar with array-entered formulas array enter means the formula must be committed from edit mode by simultaneously pressing and holding down Ctrl and Shift while hitting Enter.
Then in Name Manager this Dynamic Named Range formula.I named it Dyn_DropDown.
Then select the cells you want drop downs in and enter that name in the Source: DV editor.
I applied it to Testing A6:A17 and tested it. It shrinks and grows as I expected.
Let us know if this does what you want.
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