Wow, that's a massive drop from 539 to 174! Definitely expect to see some bouncing. I would hold your current dose at least until he clears the bounce.
Something to consider: It is my personal opinion that "bouncy" cats on Vetsulin will bounce incredibly frequently and dramatically, and take several cycles (more than you would expect) to recover from it. I base this on my own experience with Vetsulin and other instances of it that I have seen occur. Vetsulin is a good insulin, but maybe a little less forgiving than some of the longer lasting insulins. Squallie is very bouncy, and uber carb-sensitive; weathering the bounces and chasing his numbers while he was on Vetsulin became an exhausting exercise in futility.