Other than the lifter chatter, motor-wise, my 304 is pretty solid. My motorhead days kinded of faded away over the past 12 - 15 years. Power is not a problem, oil pressure (line gauge) is steady at temp, and is pretty good about oil. I don't think it was ever really gotten into. I got in back in the mid 90's from a guy who did nothing with it.
The transmission has about had it but I have another one in very good condition. A few seals have broken down so it leaks pretty well. The seal on the rear output of the transfer case is the one that has gone almost completely. I drive it around the block every so often just to drive it. Then park it and throw out some oil dry.
When the budget can tolerate it, I want to get that bit of major surgery out of the way. Here in the burbs with me as the only source of labor, it wouldn't be a lot of fun. I would like to have it as a once in a while driver. The rest of the little stuff I can handle.
I wished it had a tailgate like my 77 CJ5 did. That was so handy. Maybe if I ever do any real body work and win the lottery as to buy a replacement tub, that would happen.
Were I you, I’d dump the AMC driveline and swap in a 4.0L HO I6 (and trans) from a later Jeep. It’s a direct swap, and you will get a *massive* increase in mileage, power, and relibility. You will also gain an overdrive and a shorter first gear. And your Jeep will lose a few pounds.
In addition, you are aware that Chrysler has discontinued all parts for the AMC V8s (304-401) and that all you can get is what’s left in the warehouse, right?