I have a '62 261 in my '50. I replaced the 216.
I made my own short shaft water pump and I run an electric fan and 12V alternator. I found a Ford pully in a junkyard that fits great. However, I don't have enough room between the radiator and the water pump to use a mechanical fan, and it also sits too low on the radiator. The 216 water pump is partway in the head and partway in the block. The 235/261 waterpump is in the block. I wish I had used the adaptor plate the Buffalo and others sell to use a 216 water pump, it would have been cleaner.
Here's what I did about the rest of the motor:
My block already had the front mount holes drilled. It came out of a 62 Suburban. It really is a 261, and it was the original engine in the burb. It was optional that year only. You can drill them yourself or change the front plate with your 216 plate. This is harder than just drilling the holes.
The bellhousing bolts up great. You can use the 216 flywheel and clutch if you want, but unless you have the optional big clutch you don't want to use it with the 261, since it makes quite a bit more torque than the 216. If you want to keep the footstomp starter you have to use the 216 bellhousing.
The engine I got came with an 11" clutch flywheel. I really wanted to use the big clutch so I figured out how to make it fit in the 216 bellhousing. The later ring gears have more teeth so if you want a footstomp starter you have to match them. The ring gears are not interchangable, the inner diameter on the late ring gear is bigger than the early one. I kept my 216 starter and had a machine shop turn down the 261 flywheel on a lathe to fit the ring gear from the 216. This has held up fine. It only cost me $50.
I am running my 6V starter on 12V and it cranks really fast. It has not had a problem with this in over 4 years.
I mounted a GM 12si alternator to the block by flipping over a generator bracket and re-drilling the holes. The alternator works great and only cost $30.
You will need to do something creative with the throttle linkage. I cut the pedal rod shorter and re-bent it with a vise so it met the bellcrank and did a full stroke. Then I bought some threaded rod and pivot ends at the hardware store for the run up to the carburator. It took a few special bends and tweaking to keep it from binding but it works pretty well.
I mounted the electric fan in front of the radiator. This was a pain and I recommend avoiding this if you can.
It does work, though. I used a 2500 CFM fan with a thermostat switch that senses the surface temp of the radiator and comes on when it wants to. It keeps the engine cool just fine but it draws 20 amps when it runs.
