jerr is mixing up UG and HG.
those single speed kits will work, they're just washers that slide over the grooves entirely.
shimano is still using HG with their 8/9/10sp road and MTB parts.
maybe you're thinking of UG, uniglide?
http://www.sheldonbrown.com/k7.html
to get a 130mm wheel into a 120mm dropout... that would be very difficult, but there's hope.
http://surlybikes.com/parts/fixxer/
you can thread on a freewheel to it.