Is it possible the 1 1/32" MC does not provide the volume of fluid needed to make the calipers more aggressive?? You said it used to dive with the drums, which to me means it had substantial front brake. Calipers do require more fluid volume than a wheel cylinder don't they?
My 70 Satellite has the same issue. It has a long pedal on the first pump but it stops fine. Its been bled and bled with no difference. Makes my think maybe the M/C bore is the culprit. The line lock comment makes sense when mine is on and you touch the pedal there is nothing but hard line in the system and no way for the pedal to move whatsoever. This is normal.