For brakes, look at the post about 6 lug conversions to disk brakes, that will explain all about keeping the 6 lug nut wheels. If you go to modern 5 on 4 3/4 lug pattern, then you open up a lot more brake systems and wheel choices. Modern rear axles will be easy to come buy, you will need to swap it anyway if going with auto trans. It would be best to purchase the complete system from one vender, that way you get matching booster and master cylinder compatible with the size of calipers being used. You can really open up a can of worms when it comes to master cylinder bore sizes.
If you gear the truck correctly, you can use a standard 3 speed automatic transmission, the 261 will have plenty of torque to pull a 3.08 or higher gear. I suspect it is like most engines, it has a "sweet spot" it will run in and give decent fuel mileage. If you try and lug it down with to much overdrive, the mileage will suffer. The 200R4 would be an easier swap due to size, not sure about cost, both are expensive. I like the T350, its light weight, strong, shifts good, and easy to come by, you can even get them with lock up converters.
Joe
