we are doing a song that's originally on the key of F. Our singer would like to sing it on the key of G#. There's an electric guitar solo at the end of the song that I have to play. But after raising everything 3 steps up, nodes appear on the 23rd fret on the 1st string. I am wondering if I can still play the solo on G# and an octave lower. Would that affect the overall of the song? Or is it even correct to do so?
You can do whatever you want for a solo. Doing it at octave lower will just make it sound lower. It might not sound as prominent as a result. Basically, if you all you can do is play it there then just play it there. You won't be breaking any rules. If you don't like how it sounds there then you can change it accordingly but really how it sounds and feels is all that matters.
You could always try moving some or all of the notes onto different strings. for example, that 23rd fret bottom string appears on the 18th fret of the 5th string. You did mean the fattest string, I hope?