I converted a '77 Gitane this summer. The big thing you'll need to figure out as you work on it is whether it follows
French standards or something more standard. My Gitane ended up following modern English/ISO standards almost everywhere. Mine was a much lesser model than your (judging from the components), so my experience may not be entirely applicable to your situation, but let me tell you what I did. This may be more than you want to know. (Pictures
here if you're curious.)
I started out wanting to do the minimum to get it up and running. Mine was completely rusted over (it had been in someone's barn for about 30 years), so the minimum was a lot. You might get away with less.
First thing I did was strip it down to the frame. Even if you're reusing parts this is a good idea because you'll want to replace bearings and add grease. Save absolutely everything, as you never know what you'll have trouble replacing (French sizing may haunt you).
I dove into this head first with no caution. On my first attempt, I managed to get everything off but the stem, which had fused itself to the steerer, and the bottom bracket, about which I knew just enough to wait before applying excessive force (more on that below). Of course, these are the main places where bearings needed to be replaced, so that was bad news.
Removing stuck stems is an ugly business. I tried everything that didn't involve a hacksaw, but none of it worked. I was able to unscrew the headset, so I just overhauled it as it was, carefully replacing the bearings and adding lots and lots of grease. That worked, and the stem was close enough to where I wanted it so I left it at that.
The bottom bracket was a big question mark for me, and it will be for you. You need to figure out if it's French-, Swiss- or English-threaded. Again,
Sheldon Brown is your friend. Depending on which it is, you may be tightening it when you think you're loosening it. The adjustable cup (left/non-drive side) turns the same for any of these (lefty-loosey) so you can muscle it off, along with the lock ring.
Since I didn't know what kind of bottom bracket I was dealing with, my first approach was to clean it and replace the bearings without removing the fixed cup. This worked, and I used the stock crankset (a 53T SR SunTour in my case) with the small chain ring removed. FWIW, my bottom bracket turned out to be English threaded. There's a very good chance yours will be French.
I replaced the old pedals with some Crank Brothers Smartys I had already. I was quite happy to see that the threads matched.
The old wheels were completely covered in rust, so I just trashed them. I had a set of modern Alex/Shimano wheels with tires in the garage, so I got a singlespeed conversion kit with spacers and a 20T cog and put it on there. Going this route allowed me to use the spacers to adjust the chainline to match the crankset, thereby eliminating any worries over spindle length.
My frame, like yours, had 120mm rear dropout spacing. Since my wheel was 130, I respaced it using the
2x4 and string method. This worked, but I later regretted it, when I bought wheels with a flip-flop hub and 120mm spacing. I'd recommend that you jump straight to that if you don't use the stock wheels.
I had an old 8-speed chain in my garage, which I used to replace the rusted original.
The handlebars were very rusty, but they cleaned up well enough. A little fresh bar tape and they were presentable.
Switching from 27" wheels (original) to 700c caused a slight problem. The original brakes had enough reach in the front to make this work, but not in the rear. The rear was close and I was able to make it work by cutting a slice off the brake pads. I later found a replacement vintage Dia Compe which had the extra reach I needed. Nothing made today has enough reach, so I'm stuck with these calipers. The good news is that modern V-brake pads with threaded posts work with them. I installed new Tektro R200A brake levers, because I hate the old style.
I cleaned up the original seat post and used that with a saddle I had in the garage.
Finally, new brake cables and pads, and I was ready to go.
I've done a lot since then, some of which may be relevant, but I'll leave it there for now. Ask if you want to know more. PM me if I don't respond, as I don't read this section regularly.