You're describing the problems small block engines have had since we first started doing in-frame rebuilds on 265's in the 55 models when they got a few miles on them. I was the kid running the drill motor on an auxiliary pump in a 5-gallon bucket while my father and his partner looked for the source of the low pressure with the oil pan off a couple of them. The cam bearings leak enough pressure to drop the hot idle oil pressure and make the idiot light flicker at a stoplight, particularly on automatic transmission models.
We stopped doing in-frame rebuilds and started insisting on changing cam bearings on every overhaul, as early as 1960 or so, which was a radical new idea back then. We lost a few customers, but they came back to us after getting a shade tree rebuild from another shop.
The difference now is the fact that high-volume oil pumps are available now, and they weren't back then. To save the day on your present job, drop the oil pan if possible and install a Melling high volume pump. It will flow enough oil at idle to keep the pressure up, and the relief valve will bypass enough oil at speed to prevent overstressing the distributor drive gear or intermediate shaft. If you can get the idle pressure up to 20 or 30 pounds, there won't be any longevity problems at all. Even 10 pounds is enough, but it's worrisome.
Jerry
