maybe an AnP inspection on the engine, and if its good as is, I might just try to get the Cozy flying with this, use up the remaining 400-500 hours (which should be a good few years), and then invest in an IO-360 ]
I just grin every time I think of the project and I wonder if I am getting ahead of myself...
Yep, you could certainly go that direction but A&Ps don't work for free and if you find rust or valve problems, you're back to putting a lot of time and money into a less-than-ideal engine and a prop for it. If you had a logbook, you'd know a lot more. For example, a flight-school motor that flew every day for 1500 hours is a much better candidate than the engine off an airplane that flew 50 hours a year for 30 years.
If you determine you want to use it, there are cheap ways to inspect it yourself. Rust, cylinder wall condition, valve wobble, and spalled cams are things to look at.
If those are OK, just bolt it up and use it.
OTOH, you don't need to get married to this engine just because it came with the project. Even with no engine logs, if you can reasonably assure a buyer you've inspected for those things, this engine would sell pretty easily, I would guess, then you can get the bigger engine.