The 700R4 will help some with mileage, but the 235 and 283 didn't really do that great on fuel in these trucks any way due to the rear gears.
My 235 with three speed and 3:90 gears would get about 15 to 16 mpg on fuel, and 55mph was comfortable in it.
My 350 (fuel injected with 4L60E ) and the stock 3:90 gears now gets 20 mpg at 70 mph. Plenty of get up and go past that if I want it.
So don't really think you will help yourself going to a smaller engine. The 327 is a great engine and I bet with the 700R4 behind it your fuel mileage will increase.
Thanks Roy, I`ll try it out
