At a loss about coolant issues.

Did you burp the radiator? This commonly causes boil over. Also the radiator cap is commonly the culprit if it is not relieving pressure like it is suppose to. Hope that helps.

there is definetly a problem if you are getting 5 mpg and its not a strictly drag car. pull the codes man and see whats going on with the engine. if you dont know how or dont have the tools, grab a paper clip and do a search for JRichker. he will help you out, that guy is like an automated mustang encyclopedia of knowledge

edit: are you sure its boiling out? have you checked your oil to see if its a blown head gaskets or intake gasket and all the coolant you are loosing is actually in your oil pan?

Check the basics. Make sure the thermostat is installed in the right direction. Make sure the radiator is clean, and that the lower hose is not collapsing, ie, the internal spring is still there. I would not expect it to run cool with no t-stat at all.

See that the water pump is turning the right direction and the fan clutch, if you have one, is working ok. Is the fan shroud in place.

Make sure the ac condenser is clean.

Make sure you have all of the air out. Ironicly, I changed head gaskets on my Windstar, could not get it to cool, and tore it down again. Same problem second time, until a Ford tech told me the rad was lower than the engine and you had to fill from the heater hose or vacuum fill it.

If possible, do a compression test to see if you have a leaking head gasket.

It could be that the head gaskets are installed on the wrong side. I take pictures at that point sometimes so I can check it.

My overbored engines have always run slightly hotter, 5 or 10 deg than the same engine at stock bore.

Strangely, my 82 runs cool with just a new 2 core stock replacement radiator.

Sometimes, a new, clean radiator will make a big diff.

Been my experience, if it heats quickly at idle, it is a head gasket or low water, but if it heats up normally, but get too warm, it is radiator related.

The fact that the engine is .40 over could be contributing to the problem. Thinner cylinder walls dissipate less heat. If the timing was off too much in either direction the car could get hot and a vacuum leak could make it run hot. You need to fix all of the fuel related problems before you can really find the problem. Also, I believe that 5.0 has a reverse rotation cooling system. The 84 block that you are using is a non roller block so if you are using all 5.0 bracketry and water pump this may or may not cause a problem.

thats the bypass hose, to let you know the term for it

starter could be fouling out because of heat soak... try a new starter or rebuilt unit and see if it doesnt do the trick

My radiator cap went bad. Squeeze the upper radiator hose. I could hear air squeezing out of the cap when I did that. Knew right away I needed a new one.