Re: swap. 350 for 305
Here's another thought - I don't know that a 305 non vortec will be a drop in engine for you if the 350 was vortec... there were a few changes made in the years between to the bell housing, flywheel, ring gear, and starter.
Just FYI, you can find a reman 350 engine for close to the price you want... if it was your block that was cracked, the you can replace that for less than $1400 (new short block). I paid about $1750 last summer for a reman 350 non-vortec long block from rapido marine, and other vendors have similar prices.
At any rate it sounds like you'll be dropping too much power for this to work... a 350 vortec four barrel is pretty close to 300 HP, and a 305 would be a quarter to a third less hp, and maybe more torque than that. Big change.
Erik