Bled with the yellow block and it feels like there's too much fluid in the system if that's possible.
Remove some fluid or is there another trick to try?
push the pistons back into the caliper would be my first attempt at fixing that - if you have really filled the reservoir you might have to undo the screw to let out spare oil as you push the pistons
Put the funnel back on (with a bit of oil in), push the pistons back in (I'd take the opportunity to smear some silicone grease round the edge of the pistons before doing it). Remove the funnel, put the screw (and seal!) back on. Clean any excess silicone grease off pistons and caliper, put pads in, adjust onto rotor as normal.
I like my brake levers to have little movement and used to overfill to achieve this.
If you've used the yellow block then travel should be "as designed" but some 3rd party pads are thicker than genuine Shimano so can cause problems.
Set the levers to the distance that suits you, and when you squeeze them you'll slow down.
How old and/or gubbed are the brakes? Sticky pistons can cause this. Are the brakes rubbing? If the pistons aren't getting retracted back into the caliper there will be no free stroke at the lever. It's only the deformation of the square section seal that pulls the piston back in. Any dirt or corrosion can prevent this. Might be worth lubricating the pistons & working them in & out a bit to see if you can free them off if this proves to be the case.
Is this with the yellow bleed block still in the caliper? If it is then that's normal. Put the pads back in and re-attach the wheels. Pull the brake lever a few times and realign the caliper. Should be ok then.
Otherwise, it's not something I've come across. The above suggestions sound reasonable.
My SLX brakes have virtually no movement when I push the pistons back in and replace the pads but I've found that if I loosen off the caliper bolts and pump the brakes a few times they regain their normal amount of throw. Then it's just a case of re-aligning the calipers and I'm off.
Lubed up the pistons ,pushed them back and all is well.
Lubing the piston! :o) Glad you're sorted.