The price for the PSD is right, although that makes me wonder what's wrong with it. Given the age and being an ambulance (running 8+ hrs a day) I'd expect that motor is tired if not completely shot. At the very least I would do a very detailed inspection of the engine before messing with it - would suck to go to all the work and find you swapped a worn out engine to replace a worn out engine.
The actual swap I don't think is too terribly bad if you're reasonable capable mechanically and have the attention to detail to figure out all the electrical stuff. If you have the complete chassis with the PSD that will help since you'll have everything there - where these type swaps go bad is when you have just the engine to start with and you wind up chasing down all the little odds and ends other parts and praying they all work together right.
Also note that the ambulance is probably a E series (van) chassis, so some things may be different than the truck application. I know there are minor differences in the idi motors so I'd expect something similar on the psd.
Plan on the truck being down for some time (estimate the amount of work conservatively then double that time....) and make sure to budget a decent amount of money for any parts you need - guaranty you'll break something, find something worn out, need a different part, etc. I personally would make sure I had the ability to spend $1000-1500 on parts before starting it. Again, would suck to get almost done and not be able to finish because you need something you can't afford then be stuck without a truck at all.