So I haven't posted in a while and decided to give a little update. I now have the car sheet metal only from the front bumper to the back seat. Everything is out of the dash and engine bay. Here are a couple of pictures, but they don't show much. Since the pics, all of the dash parts are out. The windshield is also gone, we pulled it last night and luckily it is still in one piece. I am ready to start stripping and blasting paint on the front to find all of the rust. The main work is foing to be replacing the RH front frame rail and the LH kick panel. I need to do some more research on if the LH cowl vent leaks, but it looks like the water came from the washer fluid pump that is over there. I need to pour water in the cowls to make sure though.
The engine is ready to go back together. We bored the block .030" and it looks good. The heads have been surface ground and the seats cleaned up. Looks like we had three burnt exhaust valves, worn valve springs, and worn rocker arms. All of these are going back new. It also looks like the engine was rebuilt sometime early, maybe in its warranty life. There are 2 number 1 connecting rods. All of the parts are FOMOCO, so we think maybe the rebuild was done at the dealer. With the new bore and heavier cam, the engine will probably go from the old 195 hp, (130-150 in its current state) to somewhere around 210-220hp. I am thinking about going to a 4 barrel carb and intake manifold. That would make this thing scream, but I don't think it is in the budget right now, maybe later.
I am starting to order parts so that I can have the engine completely ready to drop in the hole when its ready. I am going with all new "reliability" parts. New starter, starter solenoid, voltage regulator, alternator, pertronix solid state ignition, water pump, plug wires and distributor, radiator hoses, and a carb rebuild kit. That is a lot of cash in a small area, but I think it is worth it to make sure when we want to go for a ride, all that is involved is finding the keys.
Brought home the motor this weekend. I've started putting parts on it to seal up all of the holes. So far, I have the fuel pump, distributor, spark plugs, and temp sender in. I'm going to do more tonight. 
Here is a picture of the current state of the motor. All assembled and Ford Blue. It is a huge difference from how it started. All new parts and ready to go. I stayed with the 2 barrel intake and carb, so I need to go thru a rebuild kit for the carb. We put plenty of engine assembly lube on everything because it will sit for a while.
Fresh tins. We blasted the covers and there was still some pits in the valve covers. The oil pan is perfect, to bad it is under the car !! I chemical stripped everything and painted with Ford Blue hi temp engine paint.
Brass freeze plugs and the heads are ready to go on.
All new pistons and rings.
Pulled the RH Front apron off today. I wanted to start on a bad panel to get used to the spot weld cutter and chisel. Worked pretty good. Next is to keep cutting the RH loose until I get the frame rail out. I attached some pictures of the front frame of the car. It has a bad spot at the bottom. I am going to blast it and hopefully have metal.
