Fuel economy...hmm...not really a word I recall being used in connection with a 351, or any V8 for that matter, back in the late seventies and early eighties...

Big bent eights, especially post-July 1976 when ADR-27A came in (the birth of anti-pollution), are notoriously bad on fuel...I am talking sometimes nearly a third worse after anti pollution gear was fitted.
Also, as I said, the power figures were mysteriously dropped from nearly all car magazines in 1977...I don;t even think brochures from dealerships mentioned the horsepower figures.
From what I can recall, a standard 351 in good tune, in something like an XC or XD Falcon, should return something like 10 to 14mpg around town, maybe 18 on the highway if you drive it nicely. Stick a clunky old 3 speed auto behind it, and you're looking at less.
Current V8's like the 6 liter LS2 get rediculous fuel economy figures on the highway (equal to some 4 cylinders of the seventies) because of super efficient EFI systems and gearboxes with 18 overdrive ratios (OK, I exaggerate a bit...). Stick a big four barrel carby on that LS2, and back it with a 3 speed auto with 1:1 ratio in "Drive" and you're fuel economy would drop like a stone back to the bad old days.
If I was building an XD with a 351, and I think you mentioned you weren't out for outright speed, I'd stick with a 2V basic engine, get the heads shaved, ported and polished, and valves and guides set up for unleaded, mild cam, compression ratio nothing much above about 9:1, lightened flywheel. Carby only needs to be (using the CFM calculations of cubic capacity x maximum rpm you will use (be honest) divided by the constant figure 3456) something like a 500 Holley two barrel or maybe a 650 four barrel (don't let anyone talk you into a double-pumper 650...seriously...some guys will have you believe you MUST have a double-pumper. No, you don't.) on a port-matched manifold. Make sure you find someone who knows about jetting and power valve sizes or have a look on Holley's website for advice...it can be a nightmare if someone gets it all wrong, and it;s a bastard to get right again. Set of extractors, twin 2-1/2" system with a single muffler each side, and she'd sound sweet. Whack on a pointless electronic distributor and MSD.
Now comes some bucks...get a Dellow or something bellhousing kit, and fit a four speed auto out of a newer Falcon, or a five speed manual steel case Celica box (if you can find one...something after-market otherwise).
Three inch driveshaft with loop, and a diff ration of around 2.8 to 3.1:1, and you're away. Oddly enough, unless you are going to be absolutely hammering the car, if the car you get doesn't have a nine inch diff, you can actually save some dough by leaving the 8-7/8" Borg Warner diff in place. They usually had a ratio of around 2.98, and you can find them with disc brakes on things like XC Fairmonts and the like. They are a good strong diff, and like I said, unless you plan on racing the car or thrashing it mercilessly, they will last just fine.
Set up like that with a modern overdrive box, a nice light XD should return reasonably OK fuel economy figures...probably around 26-27 mpg on the highway or more.
Apart from the modern gearbox, that's virtually a copy of an engine I did up for a friend to put in his 1979 Marquis Fairlane, and several others I knew of around the place in the eighties.
God damn...I haven't thought about a motor like that for years...thanks for bringing back great memories...

