If by any chance I have scared you out of the diesel (which I hope I have not!), then I want you to know that there are options you can do when it comes to the small block V8's.
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At the bottom is 1983G20Van. He has done some neat stuff when it comes to low-end torque production in small blocks, which is what's going to give you fuel economy in these vehicles. While not very scientifically accurate, he claims having a trip of 21 mpg with a 400 sbc going 65-75 with A/C on.
He says he didn't get there without tuning his beast and having the right setup though. But! It is possible