302 heads

302's, fine. 308's already have the valve size, port size that you want plus they probably breath better on the exhaust side than the 340 heads. If you can grab a cheap "good" set and have them milled .040, that will probably be your best bet. Even milled .040, they still will not have the compression that the 302's will have, however, flow trumps compression every time. If you were never going to go above a 100 % bone stock long block 318, I'd say the 302's. If your going to be doing the whole cam, carb, header thing, I'd personally do the 308's. Less money than rework'n 302's.