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If you can wait, you should be able to get a good slant locally for almost free. I recall seeing a bunch of govt surplus rebuilt slants in wooden crates sold on ebay for ~$800 ea a few years ago.

Before you do any of that, check the compression. If it is good (>100 psig all cyl), your engine should be fine. First, turn it over by hand by tugging on the fan belt. Mark the crank pully w/ chalk. If you feel 3 strong resistances per revolution, your engine is in prime condition. The "smoke" could be from many things. Blue smoke under hard acceleration is the main indicator of bad rings. Otherwise, it is more likely grey smoke from burning rich or oil getting into the intake (usually valve stem seals) when sitting a long time at idle. If a cylinder is so bad it doesn't fire, you will see a perfectly clean spark plug from the raw gas passing thru. But that could be due to valves. If the only true engine problem is the rear seal, I think that can be replaced with the engine in the car, at least I have done so on my SB & BB Mopars.

It is fairly easy to mount a V-8 in your 1965 (I assume, you didn't tell us). However, you would need a matching transmission, new steering center link, new throttle cable and kickdown linkage, ...