I have a 318 short block currently. I am struggling with the fact that everything swaps right out. A 360 block will need a 360 short, engine mounts, oil pan, flex plate, etc.
If you use the 340 you still need to change the mounts. The 273/318 drivers side mounts are the same and the 340/360 drivers side mounts are the same.
4.125 is WAY too far over. Unless it is an X block. I have had 3 and sonic tested 2 of them. The 2 I tested would easily go 4.125 in spite of the MP books saying it wouldn't.
Unless you can verify exactly what it is...PASS on it.