If you want it too look original, I would get a vintage style digital radio that looks original. I know that alot of people say that they are not as good as the other aftermarket units, but they serve the purpose for what you want. I would put the updated stereo speakers in the dash to replace the AM speaker. Then you can run a pair of 6x9's in the rear and use the factory style speakers grilles and it will look stock. These are available at most Mustang parts places. I know Mustangs Unlimited has them.
This is what I would do. Its very close to what I have except I have a Kenwood stereo, since my dash was already cut up.
You can get a panel to repair a cut up dash if needed.