The bicycle in question is a mid-1970s Miyata MX-E. It was the base lightweight at the time and, as suggested, is a hi-tensile steel frame.
Upgrading bicycles can be expensive. Personally, I would keep it as is, while keeping an eye peeled for bargains in components and/or a better bicycle.
As for the wheels, I suggest you borrow a set of 700C to see if you have adequate adjustment of the brake shoes with the current calipers, before you start buying things.
BTW, Miyata stayed involved in the US market long after most Japanese brands bailed out. The decision appears to hav been made by the US offices and not the head company, as Miyata continued to be imported into Canada long after its demise in the US.
Last edited by T-Mar; 09-21-09 at 07:24 AM.