Rebuild the 4.8 that's already in there, rebuild transmission or swap to an 80E, and do a JY/Chinese turbo setup on it with mild boost. Depending on what your stock injectors are (EV1, EV6, EV14) buy a set of used takeoff Cobra 39's, LSA, etc injectors for <$150 and throw a Walbro or Aeromotive fuel pump in the back for $100-$150. Let her eat and enjoy the boost in fuel mileage too! It shouldn't be that expensive and if tuned well can run for a long time. If you somehow manage to blow the 4.8 then swap another in or step up to something bigger that will still be dirt cheap. I suggest trying to avoid DoD if possible.
with rebuilding the 4.8 that is in here, what steps to rebuild? all new gaskets? get it bored at all? do anything to the heads? head studs... run the same intake manifold?