You do significantly better mileage with the 455 than the 302. LOTS of power and it doesn't need to be worked nearly as hard as the 302 to get the big girl moving. Member 69Olds here has his M211 powered by an early 68 455 Rocket with J heads, th400, stock Rochester Qjet and an Edelbrock performance intake. I talked to him on the phone (great guy) and he swore by 12MPG on the highway, he didn't even have to drop a prop shaft on either rear axle to get that mileage. He loaded his with 15,000lbs of gravel too and it pulled hills like nothing. He said he even smoked all 10 tires at Mcdonalds.
Personally, If I had an M211 that was all original and in perfect running condition I'd leave it be. But, If I had a 211 that has already been modified (like mine) or was in non running condition, I think a 211 powered by a CUCV power plant would be SWEEEEEET.
The CUCV's have GM 6.2L V8 diesels in them with turbo 400's, everything is already 24V too. It would be a pretty easy and relatively inexpensive swap. Keeping with tradition your truck would still technically have a Hydramatic (albeit a better one) not to mention genuine Military truck parts.
If you shop around you could probably find a complete CUCV power plant for about $1000. Heck, I already have a th400 in mine..... I might just do this same swap if someone locally wanted to trade a good diesel engine for my 455 torque monster. I think diesel smells better, sounds better, I bet you'd get better mileage, with a few simple mods you can use cheap (free here) veggie oil too. The 6.2 would offer more power than the 302 but wouldn't be serious overkill either.
I need to stop thinking about new projects........