Not that my opinion matters at all since you already have a plan, but just basically wanting to solve the immediate problem without going into a big job I think your thoughts on lapping the valves and replacing stem seals is a good plan.
During that you can decide if it needs more.
Did you ever hear the joke about the guy that took Carters Little Liver pills his whole life?
When he eventually died they had to beat his liver to death with a stick.
That is what spending the money to do a complete head refurbish on that motor reminds me of. :D
