360 compression ratio, Am I wasting my time?

Milling the J heads to get 9.0 to 1 compression with the factory dished pistons is nearly impossible. Those factory pistons were about .080 in the hole and with the dish are only about 7.5-8.0 compression assuming the heads are stock. If the bottom end is rebuilt like you say a swap to the newer magnum heads would be the easy way to go. They have much smaller chambers. They spec at 59 cc but are usually around 61-62 cc. Mill them .020 and install them and that will bump the compression up to approx. 9.0-1 compression. They also have better low lift flow numbers than the old J-heads an a better exhaust port design. So not only will you benifit from more compression but you'll benefit from better flow. You will have to buy an intake made for the magnum heads and conversion pushrods but everything else will bolt up.

The only other route to take is like Prostreet duster recommended and go with a new set of pistons which will mean a total rebuild of the bottom end and you will have to have it balanced because the KB pistons are allmost 100 grams lighter than the stock pistons. If you don't balance it it will shake itself to death.

You should also try to determine what cam it has in it. When I bought my Cuda it had an awesome sounding cam in it but it was a major slug. It was an old grind with alot of duration and only .440 lift. I switched it for a comp xe274 and the power increase was dramatic.