I've rehabbed a few of these early-90s Trek 8xx bikes in the past year. Here are some suggestions from a fairly budget-oriented perspective:
1) Consider buying a 3x7 or 3x8-speed name-brand mountain bike off Craigslist solely for the wheels (at least the rear wheel) in order to switch to a freehub-based wheel. Swap your old freewheel into the "new" bike and sell it on craigslist. If you clean it up, you might even get more for it! Now, you can use standard cassettes (you'll need a $2 spacer for a 7-speed cassette on an 8/9-speed hub); I'd stay away from Nashbar/generic cassettes due to build quality and stick with SRAM and Shimano.
2) Buy a new SRAM X Gen front derailleur for $9+shipping (I bought a few from these folks: http://shop.vendio.com/benscycle/ite.../?s=1249804561
- recommended!). It's universal (shims for the 3 major seat-tube diameters, can be used either top-pull or bottom-pull) and good quality, and designed for a 44t large chainring.
3) Consider a new Shimano Deore rear derailleur for $22+shipping. (I and others have had good luck with these folks: http://www.cambriabike.com/shopexd.asp?ID=33426
). It will work fine with 7, 8, or 9 speeds.
4) I'd strongly suggest installing new cables & housing with each derailleur, and new brake cables and housing. These are the cheapest stainless steel cable kits (including housing, ferrules, etc) that I've found: http://www.pricepoint.com/detail/157...-Cable-Kit.htm
If you shop for the parts separately or at your LBS or go for galvanized, you might be able to pay somewhat less.
5) Check if your BB is holding up. If not, you might consider buying a lower-end crankset & appropriate-length square-taper BB. The $40 Shimano FC-M442 has replacable rings, and the 22t small gear will give you plenty of easy pedaling up hills: http://www.universalcycles.com/shopp...1&category=380
6) Don't forget a new chain! The same folks as in (2) above have an SRAM PC-830 chain (with included masterlink) for $11: http://shop.vendio.com/benscycle/ite.../?s=1249804561