Here are a additions/clarifications to Dave's helpful/informative post/list:
The 1958-1963 USA 261 blocks had oil passages that allowed hydraulic lifters.
Canadian Pontiac 261s used hydraulic lifters.
My guess (warning-warning : this is a guess) is that 58-and-later 235 hydraulic lifters should/might work.
Maybe Pre '68 Dave and/or others will comment.
Nonetheless, I'd stick with mechanical lifters.
Another way to describe the 1954 and later Corvette mechanical-lifter camshaft is to say it is the same camshaft designed-for (and introduced in) the 1954 261 truck engine. This camshaft can also be used in high-pressure truck 235s
I wonder if this is the same camshaft that the Canadian's use with hydraulic lifters?
(does anyone know the Canadian 1956 and later truck (and Pontiac) camshaft part numbers/numbers?)
I agree about keeping the old distributor if you are thinking about going to an HEI unit. The original distributor works fine at the RPMs you'll most likely be reaching. It is also reliable. I carry a tested distributor as a spare (on long trips).
I have used a few dual-carb set-ups on my 1960 USA 261. As Dave posted, they might be more trouble for minimal improvement.
If you do not need Eye-Candy duals or triples, you might want to consider a larger/bigger-CFM single carb. If you can find the correct adapter-plate/base, a single GMC Zenith 270/302 carburetor with adjustable metering jet/jets works very nicely. My 261 is over-bored to around 270 ci, and a 2-barrel AA1 Zenith (from a GMC 302) with available/adjustable jets performs real nicely. When I am just cruising on highways, I get around 18mpg. If I open the jets for high-speed or better acceleration, I can get some impressive oomph at high speeds (and, the gas mileage falls).
