Those old 216's will not take much spirited driving as the dipper oil system is just not up to higher revs. If you want a restoration, however, you have no choice but to keep it and live with the limitations. If what you want is the "look" of a restoration, but with more modern capabilities, you might consider upgrading the 6 to a later 235 or 261 which will have a pressure oiling system, more useable power and yet will look (at least to the casual viewer) to be stock and will be a mostly bolt in swap.
Keep in mind that to use the 400 you will have to replace not only the transmission, but the entire drive-line since the original truck used a torque tube rear axle which is not compatible with a modern automatic. Also, with that increase in power you would need to upgrade the brakes and probably steering so it is not going to be a less expensive option. It would, though, be a much more exciting truck to drive.