I see nothing wrong with updating a well preserved truck.You wouldn`t be considering this on one in rough condition.Although you have a nice surviving example,those aren`t bringing real crazy money,yet.Since it came with the 5.7 diesel originally,it would be right in there with most of the rest being converted.That Olds block is a sought after motor for drag racing.A very stout block to handle big horsepower.It`s just me,but I`d consider putting a marine-duty 6.5TD in there.Go to
www.peninsularmarine.com and see.I have one and love it.If you have any interest in GM diesels there`s a site to go,
www.thedieselpage.com for lots of info.Have fun with it.It sounds like a nice truck.