Nice frame and I really dig what appears to be sewn-on leather bar wrap.

Round wheels do roll better. Depending on your budget and local market, you may be able to pick some decent used ones. Otherwise, you could track some vintage wheels on e-bay.

When faced with a similar situation, I laced-up a new set of rims on the old hubs for around $100 including spokes (and learned how to build wheels in the process).