Revving a stock block above 7000 is wreckless. Back in the day, guys with the best forged, balanced, girdled assemblies couldn't prevent crank-walk at those engine speeds. With a 50oz imbalance, I absolutely wouldn't go past 6500.
Depending on what you're trying to do, I don't think it's a terrible idea. Obviously, 205s would be far from optimum on a 302, but I wonder how they'd compare to a non-top-of-the-line 302 cylinder head. For example, how would the numbers with a 205 combination compare to say a GT40X headed combo, which you could probably purchase for around the same amount of money?
You would certainly suffer on the low-end with the 205s, but you'd make a lot of that back up top. Stick with a high RPM intake and cam to take advantage of the extra flow the cylinder heads offer. You'd definitely pick up some serious power, and you should highly consider stroking the block out to a 347 to help the motor draw the air necessary to really take advantage of them.
Word to the wise: take a very very close look at everything on the head. Ask if they've been milled. What work has been done? Test the seal on the valves and ensure that the bolt holes aren't stripped etc... You usually get what you pay for, and $800 is extremely cheap for these heads even though they're used.
Good luck,
Chris