I'm in the middle of a 460/c6 install in a 62 Falcon right now with a friend and we did major cutting on the floor tunnel it is wadjed between the shock towers right now without the manifolds on it and I don't see the original steering box working.
Can't beat that for low buck fun. If you can find some of the earlier 72cc chamber heads that'll help some too. The 385 series motor makes plenty of power on its own and it'll move the car just fine. For sure an FE would be cooler, but initially I think the 460 will do nicely. Since you're going with a straight axle you can get rid of the shock towers entirely so header clearance shouldn't be an issue.
i built one of those a while back. i used a 62 econoline straight axle, When i put it in. i also used the steering box and colum. it is a push and pull set up it set way back towards the firewall. i made brackets mounted on top of frame. if you go with that type of axle you can use a steering box out of 1979-84 toyota 4 wd they sell and adapter kit if your on a budjet like me you can take it to welding school anywere and have it made very cheap. speedway has big block 55 chevy fenderwell headers on sale for 200 bucks right now if you find some junk 460 headers and cut off the flangesand have welding school weld them back together it will work cheap they are almost the same just flanges are different . you will find out if you are gonna relocate the steering box and use fenderwell headers you need to mach these up together.to get a proper fit. also if or when you cut out your floor and firewall and you are ready to put in new metal you can find a 67-72 ford pick up and cut out the trans tunnel and fire wall in one piece they are perfectly recessed and look nice and are easy.i have a bunch of 460 good stuff i can hook you up with cheap im not using anymore i went to a 430 mel just pm me
have a 61 w/390 c6 used a econoline axle Granada disc rear a steering box from early bronco headers from 67 390 mustang never cut the 1/4,s but had to take out shock towers and the hood closes goes like stink on you know what !!!