I ran a '66 housing in my M for a number of years. The first install I just pushed the springs outwards and kept the ISO rubber sandwich mounting for the rear. The only fabrication involved with this method was drilling out the spring pads on the axle with a 1 9/16" hole saw to accommodate the centering pin. I never liked this as you could actually see springs bowed outward from the rear of the car. Did this hurt anything? Probably not, ran the car like that for ten years.

Eventually I decided to do away with the ISO setup and mount the axle directly to the springs. Used B body shock plates and had normal B body spring perches welded to the axle further apart so I didn't have to kick the springs out. Changed the locating pins in the springs and if you plan on running a factory rear sway bar you'll need the mounting plates from Firm Feel. Those go between the axle and spring.

From what I understand there is no difference in the wheel wells from your 78 wagon vs my 87 sedan. With the '66 housing I was able to run a 27" tall 285 mounted on a 9" rim with 5" of backspace. It would rub a little on the inside of the wheel well in the front under hard turns.