built up 318 oddly low MPG's? hp rating?

I think your best bang for the buck solution, based on everything you've told us, is to sell those 360 heads and get yourself some 318 or even 273 heads.

While the heads are off, use a straight edge and a feeler guage and figure out how far below the deck your pistons are sitting at top dead center.

Then use a compression calculator, like the one at keith blacks website to figure out what chamber size heads you need to get the compression ratio you want. That will help you choose the right heads and/or decide how much to mill off them.

One more word of caution. Not only are mopar blocks commonly taller than spec, but the 273 heads I've cc'ed had chamber volumes larger than spec. So you should cc the heads if you can.