Compression Issue (thin head gaskets??)

x2 agree

cometic will make you .020 MLS gaskets they are about $150

so the piston kit with KB-167s will give you way more bang for the buck.
put in the pistons, zerodeck the block and have at it. your stock .040 head gaskets will give you good quench distance. you could have the heads milled slightly also. just to get them flat/straight and you shouldnt have problems with valve clearance on the pistons or pushrod lenght etc like you would if you have the heads cut a bunch.

http://www.popularhotrodding.com/enginemasters/articles/mopar/0667em_mopar_318_engine/viewall.html

also those pistons come in a full kit that has good rings. i'm not sure but if they are like the BB versions, the top ring needs a very specific end gap also

http://www.summitracing.com/parts/UEM-KB167KTM-040/