I'm sure if you saw the boat, you'd really be saying that.
Let's say that the motor lasts me another 100k (or more), show me a 1 ton that would give me that amount of towing capacity and vehicle control that be bought for around $10k (and still have some residual value after I put another 100k on it).
As for mileage, I've seen some on here report getting 13mpg deadheading. I'm sure that would be more like 14-15 without a 4000lb box and all that air resistance.
Well to answer your question first, I would not even go to the run it to it drops and replace it with something else - there is too much to do to justify the cost in refitting it with another engine.
But I would look at the allison, I would also see what else is out there and try to find something that would fit your requirements without cutting the frame. I am really not sure that the job being done to the frame will determine the life time of tires and the ride quality even with an alignment because the company doing the alignment didn't know what they were doing.
The 3126 is not a bad engine, what makes it a pain is;
- Part are sometimes impossible to get when you are stuck on the side of the road.
- Rebuilds are difficult and expensive.
- Longevity is helped, but not always determined by the treatment that the engine has gotten in a previous life.
- and the engine is a dry sleeve engine, meaning if there is a gouge in the cylinder wall, you can't replace the cylinder like you can in a cummins ISC.
Remember that they built so many of these FL70s and a lot of them are just sitting there collecting dust that you can find one that will fit your needs for a good price. I saw one in NY that had a $3000 price tag on it and it was without a box, don't remember where I was but they are around.
Also just to throw this in, don't overlook a class 8 truck, I know that Escapees forum has both a class 7 and 8 section there and I think that they would say a class 8 may be a better choice for you.
Oh about mileage, I think these engines have some sort of built in must get 10 to 12 MPG programming because I never heard of an FL70 getting 14. But then again I am pessimistic.