Can they? Yeah!

Unless you get lucky and stumble across one that's already a proven good one though, you'll have to spend a steep chunk of dough. The blocks are very prone to cracking, particularly between valve seats. They have a reputation for overheating because the exhaust passages go between the cylinders. If you get a good block (or spend a young ton to make one so), make sure you get all the core sand out of it, and don't short cut your cooling system you could avoid those issues. The other cause of overheating is guys try to use the original low ratio rear gear. Many '40's have a 4:11, some a 3:78, but at anything over 45 you're winding it pretty tight. A 3:54 makes it happier.

A full rebuild with the usual stuff will run $5-8k depending on machine work needed and if you stroke it.