Might not be fancy, but if you like how it rides, it can be worth throwing some parts at. Converting to a Sturmey Archer hub is possible, if there is a cheap wheel available near you with the right size rim, go for it. Otherwise, I'd lean towards grabbing the parts to get the Shimano shifting. Or grab a SA hub and build a wheel with an aluminum rim.

I actually built up a KIA frame similar to this with nice parts for a customer who needed a really really small frame, she was quite happy with the result.