Sounds like a good plan for the future here's some things.
The waggy should have a tf727 (TF 727 similar in strength to a turbo 400, tf999 similar in strength to a turbo 350). The 727 should bolt to the dana 300 but is a bit longer.
Rebuilding a tf tranny isn't too hard. Northern auto parts has re-build kits along with books that make it simple. It should be less than $100 for a re-build kit and book, pick up a stock converter and new cooler/ lines and try doing it with your son. Worse case you are out around $250 for parts and a weekend if it doesn't go well. Also if you re-build it or a shop re-builds it have them do the vent mod. The torque flights have a pressure release vavle that will suck in water when the jeep is in a mud hole, I killed 2 tranies when I was in high school because of this.
If the 258 runs I'd keep it stock and not re-built for now (less power). No need to re-build it and then 2 years later have him decide he wants to pull it for a different drive train. Either way if you keep the 258 I'd ditch the 10 miles of factory wiring for an ignition system like TFI or HEI and get rid of the stock carb for a mc2100. The factory fuel/ ignition system is just asking for problems and some days he's late to school.