Other than the fenders, this is EXACTLY! what I would have suggested. Perfect response, Plodderslusk.
P.S. - Great bike, overall. I love that fork crown, in particular.
If it were mine, at my current age, I'd go with as large a spread in the freewheel as possible. In this case, that means 14T - 26T in the rear. This is readily available in 6 and Ultra-7 speed configurations. I like a 3T differential up front. I run 47T/50T these days. If you want a lower bottom gear, go 42/45T up front. These combinations work really well. If you want real touring gears, you need a long cage rear derailleur. Then you can go to a 34T rear cog.