Rebuild 904 or swap for 727?

Both transmissions are more than capable. I'm a firm believer in using what you have, so just rebuild the 904. If it's already a good, functioning transmission; then there'll be no surprises during the rebuild- just treat it to good quality parts. Decide what you want for a valve body- if you want to retain the forward shift pattern or if you want to go reverse; and how aggressively you want it to shift. Any good performance trans man will have recommendations for that- plus if there's issues later, it's on him instead of something "you made him do"...
The convertor is going to depend on a combination of things- camshaft, rear gear ratio, tire size, projected operating rpm, etc. Talk to your preferred convertor manufacturer and they will set you up with what you need. Use the B&M 10239 flexplate to utilize common neutral balance convertors with your externally balanced 360 with the 904 transmission.
The size U joint you use depends on the HP you'll be putting through them- if over 300-350 horse I'd definitely consider upgrading, especially if going with steep gears and big rear meats.