Originally Posted by Salamandrine

At the time when that bike was new, the LBS where I worked sold Trek frames. They weren't commonly sold as complete bikes in my area at the time. Not sure why exactly. They started pushing a full line in 84, when they went to the cast lugs and IIRC a new factory, and we picked them up. Anyway, before that it was sort of a custom high end thing, and we used Trek frames to build up touring bikes to spec. Typical spec would have been:

Phil BB and Custom built up TA crankset, maybe Sugino

Phil hubs with super champion rims

Cyclone derailleurs, with barcons or DT shifters

Other items to suit customer preference, i.e., Cinelli bar and stem, campy or weinmann brakes, Avocet seat, Eclipse racks, Phil or Lyotard 23 pedals, etc.

It seems to me that if you switch it to 700c, you'd be able to run reasonably fat tires. 650B would be practical also if you want even fatter. Depends on your preference. Either way you'll need new brakes. Looks like it still has GC450 short reach brakes? I'm not sure those could even handle 700c. 27" on touring bikes makes little sense in the current world. At the time it was thought that spares were easier to come by in small town USA. 700c was still kind of fancy and exotic. Not anymore.

I'd probably respace to 130 also, just to make it easier to spec. Phil freewheel hub - sure. Or cassette. Either will work.

I've always thought half step was dumb. No point at all anymore. It made sense back when 5 speed freewheels were standard. If you stick with 9 speed you can use Deore rear derailleurs with 9 spd bar ends. Go to 10 or 11s, and you'd need to use long cage 'road' derailleurs - at least in the Shimano world. I'd probably go 9 or 10. If you want to keep friction - not a bad option - IMO stick to 9. Check the old crank for any cracks. Replace the chainrings IMO to get 10t spacing or thereabouts. 30-40-50 or something. Or get a new XD600 etc.