Best bet gearing wise is to find a used set of 27 inch alloy wheels, six or seven speed. They will work fine on that bike in friction mode shifting (which is what it has anyway). Although the spacing is wider, you can pretty easily slip the seven speed stuff right in with a steel frame.
For single speed, your best bet is to just sell the bike as is, and pick up one of the new single speed/fixed gear bikes from (gulp) Bikes Direct. They sell them complete with decent brakes for $300. Pretty tough to recreate what they sell for any less, and selling your LeTour will get you part way there.