^^^

That's what I was thinking. 26" wheels would require some very strange brake mods/bosses and is A Very Bad Idea anyway.

There's a great selection of 700c rims and you most likely wouldn't have to change a thing to use them.

I recommend getting a front wheel dynamo from Peter White cycles and a back wheel to match. Look at the 32 spoke Mavic Open Sport silver. The dynamo thing is a little pricey as a one-time spend, but you'll have lights forever and never have to deal with batteries, recharging, blah.

Even if you aren't interested in the dynamo, the Mavic Open Sport is probably a good rim for the price. I really like my Salsa Delgado rims too, but since they came with my bike I don't know what they cost.

Look for something that'll let you run tires from 23-32 mm wide. I'd think the Ultra Gatorskin 25mm would be the ticket.

NOTE: I don't know why I'm so enthusiastic about this skinny kid's old Nikishi. Yes I do -- I love garage finds.