I think cyclotoine has valid points, in general. There are $500 road bikes (and you can find them less if lightly used) that are far superior in function and quality than lots of the gaspipe bike boom stuff of the 70s. Now, move into the 80s, especially in regards to the Japanese bikes, and you'll see much better quality. Of course, a high end vintage lightweight from any of these eras is a competent bike, although even "entry level" components today are often superior due to technology trickle-down (but sometimes much heavier than earlier high-end stuff).

And, then, of course, as mentioned, sentimental value is important.

However, that being said, the bike you refer to, Buglady, is not low end gaspipe junk. It was probably mid range at best, but it's still a decent bike, and being a touring bike, it's even harder to replace. No $500 road bike is going to have all those braze-ons and clearance for fat tires and fenders. And the geometry of a $500 roadbike is not as relaxed as a touring bike geometry. It will be much more aggressive in design, and the steering will be much more "twitchy". Aside from ghastly hybrid models or dedicated touring models, the frame geometry you have is hard to find.

What surprises me is your comments on the handling. If it has true touring geometry, it should be very stable. Is this your first experience with drop bars?

As for the braking, I'll second cyclotoine's recommendation on the SLRs (Cane Creek's SCR-5's are equivalent in design, with nice big ergo hoods that are very comfortable to ride on). I have some cross/interrupter levers on my touring bike, but I don't often ride on the flats, because the hand position is very close and not very comfortable for very long. However, it does afford the opportunity to change hand positions and still have immediate access to braking - and they do have good power. The other thing to look at is how your cantilever brakes are set up. You need to maximize your mechanical advantage. If you have too little mechanical advantage, you have to apply more pressure to stop, and if they are very poorly setup, they may only be slowing, rather than stopping you. Look here for Sheldon Brown's article on cantilever geometry. Finally, I'm using salmon Kool Stop MTB pads. They are very grippy and in my opinion increase stopping power. However, they might cause chatter on the front (I had this problem until I installed a fork mounted cable stop), though you might not encounter that problem.