What should I do with my 340 that has been sitting for years.

Glad you are taking care of it. You might as well toss the cam at this point and the lifters too. Pay attention to cleaning out the lifter bores with the minimal amount of material removal.

Putting into plastic is not the best as any moisture in the air will just go into the block as new rust. I'd put a light coat of grease on the bores and lifter bores and in the bearing saddles and any finish machined surface, and ideally put some oil impregnated cloth around it before bagging. (Some oils and greases will attack some plastics too BTW so I am not sure what is the right grease and oil to use. Cosmoline would be ideal but might not be worth the effort.)