What would be the best disc brake swap option for my situation?

One more question, does anybody know a good donor car for a disc/drum MC? I'm probably gonna cruise down to the junkyard one of these days and might as well pick one up if I can.

Glad this option worked out for you, do you know for sure from Steve that it fits a 16" rim?

If your keeping the disc/drum set up manual like I did and not power then you can find an appropriate MC from a 74' up Maverick or any 75'-80' Granadas and Mercury Monarchs, The Mavericks had the "Granada-style" brakes a year before the Granadas/Monarchs. You'll also need a new proportioning valve, use one for a 75'-80' Granada as well as it's designed for discs front/drums rear. It is exactly the same as the ones they sell in the Mustang catalogs for like $100+ but when you buy it this way from a regular parts store it's half that. I would consider getting the MC from the parts store as well, they ar eonly like $70 new and less than $20 for a reman one, maybe another $5-10 or so for a core charge.
 
Spindles look like they may have some metal fatigue fractures starting on them.

If you're right, your car isn't safe to drive around the block. Take them off, have them hot tanked and magnafluxed. I think you'll be suprised. I've never seen a V-8 spindle fail since 1984.

I've seen several six cylinder spindles fail. All of them had the stub sheer off clean where it meets the knuckle at the dust cover/drum brake backing. You'd never see it coming. All of them were finished off in parking lots FWIW.