i run 52/19 on mine and can make it up the little bit of hills in davis no problem (mostly freeway overpasses lol). 52/18 should be fine.
and 700c's should fit, but you may need to get longer reach brakes. also, if you have a 3 piece crank you may need to mount the ring on the inside of the spider to get a better chainline. the chainline doesn't need to be perfect, just make sure it isn't falling off is all.
oh and don't go grinding or cutting anything off the frame.