Engine swap advice

Eventually, most any engine without hard exhaust valve seats running on unleaded fuel will experience valve seat recession, but this tends to be very slow to happen to a slant-6 in street-driven service because of the small valve size and excellent valve seat cooling. It's not a matter of lubrication, exactly; see here for detail. If this is the problem, then a head rebuild with hard exhaust seat inserts is the obvious answer (or, if you need quick 'n' cheap, swap on a '72 or later cylinder head; these have exhaust seats induction-hardened at the factory). But typically, even if the exhaust valves are receding, it doesn't directly cause the poor running until it's in its end stages. Instead, as the valve seat recedes, it reduces the effective valve lash, so the exhaust valve hangs open and bleeds off compression. A good telltale is several valve adjustments in a row during which the exhaust valve lash is found to be too tight and the adjustors have to be loosened to restore correct 0.020" clearance and smooth running.