Today I played with the transmission and transfercase a bit. The transmission is almost complete (adapter installed and only missing the input shaft seal), and I'm pretty darn impressed with its overall condition considering how much I paid for it. It looks brand new on the inside. The transfercase gears look a bit rough at spots from sitting in a little water, but they aren't chipped and I'm going to give them a shot and see what they do. I'm betting that the corrosion pitting will wear down a bit during use and the worst I'll get is a little gear whine. After a bit of break-in, I'm planning on running AMSOIL in the transmission and transfercase, so they'll probably be as quiet as they'll ever get. All the bearings and consumable parts are being replaced, so hopefully I'll never have to go back in there (at least for another 35+ years).
The engine is still up in the air, but the Jeep MPFI 2.5L is really interesting to me at this point. I've done some measuring and it looks to be a sweet fit. We'll see how this all shakes out.
I got the word yesterday that my frame and bulkhead are being shipped and I should see them within a couple weeks. I guess I need to finish up the axles and springs so I can move it around and begin trying to fit all of these parts on it.
No pictures yet, because I get kinda greasy when I work and don't want to mess up my camera. I'll try to document as I go once I get rolling.