I got the stem out and it's obvious I don't know how to use a digital caliper because I get a different reading every time I try. All of them cluster around the 21.1mm mentioned here and that seems common to this model stem on E-bay. It looks like a 21.1mm stem that will let me use a 25.4 mm MTB riser bar (of which I have several laying around) is cheap and readily available.

The biggest obstacle, by far, is the rear wheel. The front is in decent shape and I suspect it will true right up. The rear wheel is heavy and plastic with an odd hub. Maybe it would true right up as well, I'll take it to the LBS tomorrow to enquire. However, what is my best option to get a different rear wheel? Should I look for an old complete wheel, get a rim and have existing hub built up with new spokes? What about cold-setting the 126mm dropouts to 135mm? That would be my first choice because then I can have a good set of 26" wheels built (edit...on second thought, I have a decent 135mm 26" wheel on my 1995 Trek 820 MTB), which is something I plan to do at some point anyway. I'm not willing to try cold-setting myself and my experience with bike shops is that they shy away from modifying frames (I understand they have liability issues). Any suggestions there? Is it something I should just forget about and focus on replacing/repairing the wheel?