I'm going to take a different outlook with a different set of suggestions for this K5. Bear with me...
The truck has been mothballed for a long time. Memory can be foggy. CRS was mentioned in the opening post. So, rather than throw the baby out with the bathwater to bring the truck back on line, why don't you get the truck running first? Change all the fluids, pack the front bearings. Engine oil/filter, Air filter, fuel filter. Change the plugs, wires, cap and rotor. Get it running. Yeah, it might have felt sluggish 10 years ago or more, but part of it could have been needing a tune up or a fuel filter. Keep this in mind, TBI small blocks are some of the most bulletproof engines GM ever made. No they weren't crazy high HP, but maintained well they can go for well past 200,000 miles with no major issues. If the engine isn't smoking like mad at any time or under acceleration I'd run it. Staying with the engine, you don't NEED headers. Work on getting it rolling, once it's back to roadworthy you can start to think about modifying. TBI systems won't net a huge gain with headers for power or fuel economy without some external tuning. I'd leave it be and get it running.
While you have pulled the diff covers on both ends you can inspect the inner workings. I agree with what Campy has told you about the Gov-lock in your rear axle. However, if yours has been in your family since it was new (which is pretty rare by the way) you know the history. You know if it's been beat on or babied. Yes they can give up the ghost at any moment. But with the cover off, you'll find if you have any metallic chunks, debris or flakes in the oil. You can make some decisions at that time to run it or throw it out. Given your inexperience you'll be paying to have somebody to install the open carrier. That's probably going to run you a chunk of your budget.
Just getting the truck "freshened up" is going to add up to a few bucks in fluids, filters and tune up parts. It needs to be done so that you don't have a neglected maintenance item bite you in the keester when you least expect it. Get it to the point where you can start driving it again. Once driving, you'll find other things you want to fix or modify to make better. If you start the modification process prior to getting back on the road with it, you might get stuck in the "Might As Well" process that has been coined here. That's the time where you start fixing one issue, see another issue and fix it and see another, then another, then another. Meanwhile the truck hasn't left the garage or driveway in months or years. It can blow the budget in a big way. Not saying it's bad, but if you want to drive the truck you shouldn't blow it all the way apart if the budget of time and money won't allow it. Once you can get it running, the spark of being able to drive it ignites the internal drive to move forward to make it better. Keep projects to what you can get done in a weekend. Drive in, drive out. It limits the confusion of CRS when you took it apart a week ago and can't remember what bolt goes where. Get to know it. Run it, have fun with it.
Well put.


Contaminated gasoline is nobody's friend. Many bonfires have been started with a batch of contaminated diesel fuel that I got a couple years back. I decided it wasn't worth running the watery gunk in anything, I can't blame you if you decide your stuff isn't worth running either. I'd base that decision on how nasty it is when it comes out.