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I am having a bad problem with Magento and USPS. I called USPS and asked them to remove the Signature Confirmation service because we don't our customers having to sign for their packages (we got many complaints).

However, when USPS did this on their end I couldn't generate labels anymore and I kept getting an error message: API Authorization Failure. User is not authorized to use API SignatureConfirmationV3.

I called USPS again and they told me that it is a problem with Magento. So my question is this: how can I remove this feature from Magento so that it stops printing shipping labels with the Signature Confirmation?

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You can change Signature Confirmation from code in class

Mage_Usa_Model_Shipping_Carrier_Usps at 

app/code/core/Mage/Usa/Model/Shipping/Carrier/Usps.php

method names are 

_formUsExpressShipmentRequest() and _formUsSignatureConfirmationShipmentRequest()

The filed name is

WaiverOfSignature

which is boolean accept true false

You can check field details here

https://www.usps.com/business/web-tools-apis/delivery-confirmation-domestic-shipping-label-api.htm

Do in magento way do not change core code

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