The axles are stock Ford 1-ton; the rear is definitely a Sterling, I can't tell if the front is a solid axle (rare for 80-86 Fords) or the more-common TTB. Either way the springs & axles are Ford stockers.
Very interesting conversion. I have an 86 GMC 2500 my Grandfather converted to a Detroit Diesel 4-53T with a Deuce tranny in it...it sat for 5 years or so, and took me quite a while to get running reliably. The motor runs great, but every fuel line, hose, belt, etc...was dry-rotted and needed replacing; the fuel filters were plugged with algae as well.
I'd recommend leaving the setup as-is as a tribute to your Grandfather. You can easily get this truck on the road. Check in the forums here, you should be able to find reference lists with all the appropriate replacement part numbers in them. I've gotten most of my replacement items from NAPA for both my Deuce MF motor as well as my DD 4-53T; there are vendors on this site in the Classifieds section who sell LOTS of new & NOS replacement parts.
Completely disassemble both fuel filter canisters & clean any potential algae or gunk out. I would use fresh diesel fuel to flush out the fuel lines; you can get a 12-volt electric fuel pump from an auto parts store, along with fuel line & fittings, and make some jumper cables out of 12-gauge wires to power the fuel pump. Then force fresh diesel fuel through the fuel lines into a catch container at the other end.
If the diesel fuel in the tank(s) still flows, you can refilter it like I did; my GF's old GMC had nearly 100 gallons of diesel fuel still in it that was free-flowing with a little algae in it. I used Bio-Cide to kill the algae, then drained the tanks & refiltered the fuel with my little 12-volt fuel pump. I used several cheap automotive inline filters (obtained about 5 of the custom chrome ones for free from a friend who had no use for them) to filter the algae chunks out of the fuel, then threw them away when plugged. Using fuel hose & hose clamps made this an easy task.
Make sure you add a good fuel conditioner to the diesel to prevent gelling & other problems; the Bio-Cide will survive the fuel filters to remain in the fuel to prevent algae from returning.
Is the primary fuel tank in the bed extension? Does it still have the stock fuel tank? If you can get a clean 55-gallon drum, this will be pretty easy. Once the fuel & fuel lines are cleared, and the canister filters are cleaned, install the new filters and gaskets (make sure you lubricate the gaskets with a little grease/oil or diesel fuel before installing them). Make sure you rotate the canister as you tighten the top bolt, to make sure it's seated in the groove and not cock-eyed. There is a specific order to the canister filter components, refer to the free TMs in "TMs" forum section to see the proper assembly order.
Before starting, I'd make sure the fuel supply is shut OFF, batteries disconnected, and then try barring over the engine to make sure everything inside is free. If so, then after changing engine oil and coolant, as well as power steering fluid, check the level in the auto trans and verify the belts are holding together. Now you're ready to crank her over. I'd have a spare pair of batteries on hand or a quick-charger, as you'll probably have to crank for a little while to get all the crud loosened and get the fresh fuel flowing throughout.
Oh yeah, before cranking her over, MAKE SURE that your fuel supply is ON (ask me how I know as on my DD 4-53T there isn't an Accessory Lever blocking it like in a Deuce
).
You might want to disconnect the air intake & have a wooden board handy to cover the air intake to kill it in case of a runaway; DO NOT use a rag, as this will get sucked into the engine...use a piece of thick sheetmetal or wooden board to cut off air intake to kill it JUST IN CASE.
When I recovered my Deuce a year ago, it had been sitting for a couple of years. I added 10 gallons of fresh diesel and a pair of fresh batteries, and she started right up! However, all the rubber hoses were dry-rotted and fuel was spraying from every flexible fuel line, but I was able to move her into a better position for loading onto my trailer.
Hope this helps, good luck! Don't give up, give this setup a shot to get running and you'll find it's A LOT cheaper than swapping a different engine/trans in. Enjoy your Grandfather's engineering for a while, hopefully it will bring back some good memories for you. My coworkers are shocked I drive such an old truck to work; I simply tell them that my old GMC is sentimental to me, it belonged to my grandparents and it's fun to drive. It's a PITA to work on, but fun to drive.