I wouldn't take the time to do a drop bar conversion. There's nothing wrong with the bike and it would make a very functional utility bike. I'd wait for a better bike to do a drop bar conversion. They're out there and they're inexpensive.
I just picked up this 1992 Trek 950 for $125. The paint job is in great shape and the bike makes a really fine rider. I'm thinking about doing a drop bar conversion on this as well: