Horsepower with mileage options

Mattax said
A lot will depend on the type of driving this is intendend for. A lot of idling time and stop and go is different than improving mpg on the county roads and interstates. Some will also depend on the climate. Since emissions are not a condideration, carb and timing is fine.

I think the 318 is very decent base. In stock form, using a timing curve from 67 or 68 non-CAP, should pull 21-22 mpg highway with the current drivetrain and provide good pep.
Reducing weight is always a plus for both goals. (feather duster for factory example amed at milage)
A four barrel carb will help power in the rpm range. As others have said it should not hurt mpg. The extra two barrels allow it to operate with more efficency over a wider rpm range. If trying to improve 1/4 mile times and mph - this is what is needed. Horsepower is all in the top rpm - its not the same as pep.
Small tube headers will help the upper rpm and possible the entire range. These will need to be custom for what you want to do.

Changing intake to aftermarket is sometimes better for mid and top power (2500 - 6000 rpm) and often worse for idle to mid. A lot has to do with fuel distribution during part throttle. With good vacuum this is (part thrtottle/low throttle distribution) less of a problem but it still can be worse than many stock intakes. Losing weight is good of course.
Aluminum heads. Losing weight is good. Others have already commented on other impacts. This change will require some time working on part throttle timing and fueling.

Agree there. @Penstarpurist , what kind of mileage are you guys building for? What numbers would be good for you? If you're thinking low 20's you are really close with the combo you already have. Mid to high 20's might be a tall order without a O/D and then if you throw much performance in the mix, your mileage will go away. You can build a more efficient 318 with better than 2 barrel performance but there is a line of diminishing returns when more performance starts killing mileage. Small camshafts are good for mileage. Thermoquad carbs are good for mileage. Small tube headers and smaller dual exhaust are efficient. Heck even stock manifolds with a nice 2 1/4" duals will increase mileage. A properly tuned distributor and more initial timing can increase mileage and performance. I think aluminum heads are a waste for your goals. Bottom line is, up to a point in performance, you can have it both ways. Too much performance, mileage goes away. This will be a interesting discussion.