Correct way to measure piston depth?

Thats the best way. And square decking the block will get you close to 10:1 without the KB 167 pistons. A cheaper piston to use would be the 84-90 pistons as they are .025 taller in compression distance than the older stock pistons, and they fit the LA rods pin wise.
The KB 167 pistons with the block decked will give you closer to 11:1 compression ratio.