Will 8-3/4 alxes fit in the old 65 7-1/4 rear?

If you're not an all-Mopar fanatic, the 8.8 and 9 inch rears for the leaf sprung Grenada/Monarch/Versailles will fit without modifying the spring perch. Since you have a 7¼ now, any change in ring gear diameter will probably mean that the driveshaft will have to be shortened, too.