A few thoughts:
My 66 had the original B/W auto trans. which I had swapped out for a 700R4. As I understand it, that transmission was made for the 'B' body (big) GM cars -- Caprice, etc., (which were a lot heavier than an Avanti) and were electronically controlled. A couple of kits were installed to adapt it to throttle (only) control. The shift from 1st to 2nd is of higher RPM, probably to get a Caprice (tank) moving, than is required for the Avanti and the shift is 'solid' if accelerating slowly but smooth if accelerating hard. I've not tried adjusting the throttle adjustment but a GM guru I ran into was not surprised. It may just be the nature of the beast with the throttle control. I don't like to dog it so the 1st to 2nd shift gets a little annoying. I've not had any experience with a 350 but the above is something I'd keep in mind. But if you are going the distance to do an engine swap, I'd definitely think GM transmission. An overdrive drop the rpm to ~2150-2200 at 70mph and lets you hear the person sitting next to you.
Regarding the cam and lifter wear. I was not familiar with these sbc motors being notorious for having this trouble but these flat tappet cam engines need zinc. You can read up on this but, as I understand it, zinc molecules in the oil create a microscopic clearance between the lifter to cam lobe and the rod bearing to crank journal surfaces. You can buy ZDDP additive but Valvoline VR1 Racing Oil and Shell Rotella fit this bill. The parts stores often have to order this from their warehouse.
Good luck.