If your body is in good condition, then keep your truck. Get rid of that mouse motor and drop in a small block Chevy engine. If you use the engine mounts from JTR, the engine and trans will drop right in, and you won't have to cut your driveshaft. A lot of S-10 guys are ripping out their lawn mower engines, and putting in small block Chevy's. There is a website about doing this swap:
Here's some tips:
>Whatever trans you have now, the bell housing will not bolt up to a V8. If you want to keep the same trans, then you'll have to upgrade to the full size truck trans. Forget the TH400 trans. It's a good trans, but heavier, longer, requires electronics, and it will rob you of 17% of your horsepower. Plus you'll have to modify the trans cross member, and shorten the driveshaft.
>You'll have to move the radiator forward to the forward mounting holes. No big deal.
>Use the stock exhaust manifolds. You don't need to go to headers unless you've reworked the engine.
>BUY THE JTR ENGINE MOUNTS!!! They cost about $50. It will put your engine in the forward position to give you firewall clearance, and move it over 1" to the passenger side for steering clearance.
>The whole swap should take a couple of weekends. If you have all your parts, and a few friends, you can do it in one weekend.
What you'll end up with is an S-10 with the power of a full size truck. Sure, they say the rearend is weak. It's the same rearend that's in a Camaro, so how weak is it? Just don't try to impress anybody and it'll last.
The reason that you're having trouble keeping up with highway speeds is that you have 3:73 or 4:10 gears. Swap them out for 3:08 or 3:42 gears. You'll get better highway speeds and better fuel mileage. You can find one in an 89 or newer with a 4.3 Liter S-10. Then you can cruise at 70 MPH.