Put the 3 speed w/overdrive in first gear and count the revolutions made by the input shaft and output shaft to see where you are. I'm afraid you're going to find it is 2.66...at least if that transmission matches the data I have for Studebaker in 1965. If that is the case, your rear end ratio is going to need to be either 3.73 or 4.11 and 3.73 would require you to use slightly smaller diameter tires.
Like Tim said above, start-up on hills might be a challenge. Probably will be, if we're being honest. When Patrick Dykes was doing the work on the rear end 3.55 gears I went out and met with him on one scalding hot afternoon and discussed all of this. He was clear his plan was that people would at the same time convert to a 4 speed (using his closed driveline conversion piece) and use the 4 speed with the 3.11 first gear. He knew a starting line ratio of 11 was needed if you were going to haul anything heavy or pull a trailer, boat, etc and he also knew anything below that (with a 235) was going to be flirting with the low side. Where he lives, hills are not a problem.
Now there is another option that was sort of popular many years ago. You can blend a 3 speed Saginaw overdrive with a Saginaw 4 speed and make a 4 speed overdrive. You don't gain a lot but it is interesting. As I recall, the trick is to duplicate a hole in the 4 speed case (that is in the 3 speed case) which is the 3rd gear overdrive lockout provision. But given the lack of availability of those transmissions, parts and such I believe you'd be better off going with the T5 today.
Here is what I consider a really good combination:
T5 with these gear ratios: 3.08 rear end for final drive ratio of:
1st--4.03 12.4
2nd--2.37 7.3
3rd--1.49 4.58
4th--1 3.08
5th--.86 2.65
Compare your present ratios with the 4.11 rear end to the above
1st--2.94 12.08
2nd--1.68 6.90
3rd--1 4.11
You can see the first 3 gears are going to feel pretty much the same and depending on the tire size you choose, they might be a bit improved. Your 4th gear will be your first overdrive gear and in 5th gear (assuming 28 inch tires), your engine will be running 1900 rpm at 60 mph. If you choose 27 or 27.5 inch tires, your rpms will increase a bit, but I think cruising on the highway with a 235 is going to work much better if your rpm is more like 2000 or just a hair below.
