Cheers, Retro Grouch! You sound like me. I know that, in the end, I'm probably not going to save money on this project and it's never going to look or ride like a new bike. But if I wanted a new bike, I'd have gotten one! About the only new bike that appeals to me is this one:

http://www.handsomecycles.com/index.php?id=9

And trust me, it's out of my price range. For me, the fun is in the project, the taking apart, putting together, perusing QBP catalogs, etc. etc. I don't know much about building bikes but I'm learning as I go and it's becoming an obsession! I took my new bike for a long ride yesterday and stopped in at my LBS, and the dude there gave me pretty much the same advice that I'm hearing on this thread. I think I'm going to swap out the wheels for 700c, get some new long-reach brakes and brake levers, and maybe make the switch to bar-end shifters. Out of curiosity, what's the advantage of moving the shifters from the stem to the downtube? From what I've read, both stem-mounted and downtube shifters seem rather inconvenient compared to handlebar-mounted shifters. I've ruled out brifters/STIs due to cost and the fact that I'd have to replace the entire drive-train, which was my original intention but has since come to seem like a lot of work for relatively little payoff. I also think I'm going to replace the stem and handlebars, like Ironwood did.

Any recommendations for good, not super-expensive 700c wheels and long-reach brakes/brake levers?