Sorry to resurrect the thread, but I was having somewhat similar thoughts of rebuilding. No matter what engine you go with let me introduce you to the best $30 or so dollars the curious can spend:
Boxwrench video series: Basic engine building Volume I (2nd. ed) DVD
I have no affiliation with the company and they did only rebuild v-8's but they not only walk you through the entirety of the process, they take you through what the machine shop does for you and what is available to you most steps of the way. You wont watch it one time through and be instantly turned into Mr. Pro Mechanic, but they will give you a guide from what to do to pull the engine out all the way down to breaking in the engine back in your vehicle. They also rebuild cylinder heads.
Honestly if there was a way for every person who every wanted to try it or who had a question about the process to see this I'd be willing to bet it would answer most inquiries.
Its almost worth it to see what an engine that's taken on seawater looks like when they rebuild it. Narf!