The first pic below is of me when I first got the Infinity before it was stripped of most of the padding, cinch, etc. You can just see the octo holder hanging from the d-ring. I had no issues with it in that position at all.
If you're being pinched under the arm, the straps are probably too tight and your d-rings are in the way. I had that briefly as well.
The d-rings need to go wherever they work for you. If you're standing with your arms up and drop your thumbs to your harness, that's a ballpark for where your d-rings should go. When you're diving, you can see if that spot works by checking if it's easy for you to reach and manipulate.
Having said that, I switched to a long hose with a second on a necklace nearly 7 years ago and never looked back.
View attachment 608408
Same Infinity, stripped down to the Eclipse with a long hose:
View attachment 608411