To answer the tire question only, you can run 650b x 42's on that Competition and still have room for properly fitted fenders. Peter Weigle uses that frame a lot for his 650b conversions.
Here's one he did for me:
As far as sizing goes, if the saddle height in the picture is good for you, I'd say you may have been riding too small of a frame before. Proportions look just about right to my eye, and the handlebars and saddle are the same height, which leads to a comfortable riding position.
It's pretty hard to find chainrings for those TA 3 arm cranks, and you're limited on the inner chainring size. Forgive my lack of knowledge of Oklahoma, but compared to the PNW, I'm guessing you don't need the 24-30 combo I'm sporting on my bike above, so maybe you can get by with those cranks, and extend your low gear through the freewheel.
At any rate, that's an outstanding specimen. I do 650b conversions on frames just like that, but it's in such great shape I'd be hesitant.
So, 650b x 42's, and you'll need longer reach brakes, like MAFAC RAID's - that's as far as I'd take that.
A less expensive solution would be to rebuild the wheels with a wider rim and use 700c x 35's on it. I've done that on another similar frame, and found that it works well on gravel trails that aren't real nasty.
As @
non-fixie notes above, gravel is in the eye of the beholder. Gravel in the PNW is often forestry roads that are fairly unused and aren't maintained much, even wider tires are recommended for them.