Yes, you can plumb the 1958-1963 USA 261 with a spin-on full-flow oil filter adapter.

Yes, in those years/engines, there in a pin/plug in the USA 261 block that has to be "set" for/from bypass or full-flow.

Original full-flow filter is shown below.
Attachments
261 with full-flow filter.pdf (1.37 MB, 6 downloads)
261 with full-flow filter.jpg (97.43 KB, 235 downloads)