so after a lot of thinking, I think I'll blow $40 bucks on new brake levers and cables (Sydney, I'll pm you if I decide to replace the calipers), another $25ish on a proper length quill stem and ride the trek as is for a while.

If the rear wheel gets worse or I get tired of the wobble, I decided to buy a wheel from Nashbar - nothing too fancy, mavic open pro 32h rim, 105 hub, add a sram 9spd cassette and chain, and replace the chainrings too (generic Nashbar rings). This will be another $200ish through nashbar.....nuts, but I reckon I can use those parts on my other bike too as a training wheel and backups. It's a 2002 DA and the bike looks well used so having some sram backup parts doesn't seem so crazy - I did draw the line at putting sti, etc on the Trek. I can live with the downtube shifters for centuries and easy rides.

Naturally I'll save the original brake levers, stem, bar, 6 speed wheel, chain and chainrings in case I flip flop and decide to sell it.