I just finished my conversion of that exact bike yesterday, and had a couple of suggestions if you're still planning on working on it. If you want to keep the cranks, just use the inner chain ring. I picked up a Craigslist rear 27" fixed wheel with 120mm spacing and it aligned with the cog. I did use two washers (1/8" ea.) to the inside of the frame to keep from having to bend the frame in to meet the hub. I still plan on changing the handlebars, seat and pedals, but I can do that in the future when I find deals and have money.