2wd leaves a bit more options to swap in something cheap and easy...
The original 2.8 carb engine is a poor excuse for a power plant. With the stock engine mounts and trans bolt pattern you could swap in a 3.4 FI V6 from a slightly newer Camaro/Firebird. But this requires changing the truck to fuel injection or buying an intake and decent carb and turn the 3.4 into a carb engine, may also need ignition stuff not sure if the 2.8 stuff will swap over. I have not done too much research on this swap just know that they share the same mounts and bellhousing pattern.
You could really step up and swap in a 4.3 and a trans to go with it. Same issues, can swap truck over to the TBI injection or make the engine carbed. Additionally, you'll need a new trans, new rad, and engine mounts are different. May also need to move trans x-member on the frame and a new d-shaft. Or go one better and swap in a 305 or 350. FI or carb there is alot of aftermarket support for this swap and can be done pretty cheap.
If it were me, I'd swap in a 4.3 or small block for simplicity and parts availability. Yes, it may have more power than you want for the vehicle, but the whole job will be easier to complete.