Snowman,
Here's my advice and take for what it's worth. Quit guessing at your rearend ratio. Pull the cover and count the ring teeth and pinion teeth and divide. It probably could use a gear lube change anyway. If it doens't then save the lube and reuse it. Then do what Hank said. Try a bunch of different diameter tires. If your father knows someone who can mount tires, then go to the local tire shop and 'borrow' some bald tires of different sizes and see what get's your RPM's where you want them.
Then, when you deterine what trans your going to use (I agree that the 3 speed is really tough from 2nd to 3rd), apply a road speed calculator to determine what tires will get your RPM's in the range you want with the trans you buy.
I can't recommend a 5 speed enough. When I put the T5 in I would've sworn that I added 75 HP because of the gearing and also my mileage picked up by more than 4 mpg at 70 mph.
Good luck.
I
