318 build

... I do have a question, if the heads are milled like 0.040" and the block is zero decked and if I remember correctly it takes 0.012" for the KB pistons and the use of a thinner head gasket wouldn't that affect the actual torque reading of the cylinder head bolts? What about lifter preload? ...

Torque is the same for head bolts. You want the same clamping force on the gasket. Lifter preload should be acceptable, but that is a big can of worms depending on how well you want to run.