13.5 is just fine for the switch, just make sure your fuel system can deliver 30% more fuel than you would need with gasoline. Ethanol won't destroy rubber hoses as methanol would.
i'll be switching to e85 next year too, and already have the Dom carb converted...13.5 540 with way too small 440-1 heads.
around here, e85 is $4.50/gal. cheaper than race 110. and even with the 30% increase in fuel demand factored in, the money saved will add up quickly. like you say, the motor will run cooler too. it's a no brainer

Mr Pbody should chime in with some good advice...