That is a beautiful truck
As to what power plant you want to put in...as Justin said, it depends on whether you want to keep with the period or if that isn't important. If you want to keep with the period, you're best off with a Drip-troit...something along the lines of a 4-53T would work well
If you're okay with a newer engine, the next question is what do you plan to do with the truck? Is it going to primarily be a freeway commuter, or are you planning to tow heavy with it? I don't know the dimensions of the engine compartment, but if you're primarily looking for fuel economy and aren't worried about making a truckload of power, a 4BT Cummins would be perfect IMHO. If you need something with more power, options abound...you could swap in an IDI (simple engine to swap and maintain, but not a gigantic powerhouse), a 7.3l PSD (more powerful, but you're going to have "fun" doing the electrical), a 6BT Cummins (a 12 valve won't be any more difficult than an IDI and will make more power, but it's not a "Ford" engine), or really any engine that was offered in a pickup truck.
Sounds like a fun project in any event...would love to hear what ends up happening