Yes, the exhaust manifolds and distributor and intake manifolds from a 289 or 302 will work. Be aware that the 260 and early 289s had a 5 bolt bellhousing. This was changed to a 6 bolt pattern in 1965. The 260 production ended in 1964 and this block cannot be bored out to make a 289. The 289 was a different casting, the 260's cylinder walls are too thin to bore it out to the 289s 4" bore.
The 5 bolt bellhousings for the C4 auto
trans and the manual
trans 5 bolt bells are rare. Keep this in mind.
There may be issues with cylinder heads swapping out from 289/302s. Some heads with the large combustion chambers are too big for the 260's bore size and there are issues with the pushrod guides on 66 and up heads. Ford went to what is called rail rockers, where the rocker arms keep the pushrods centered. The earlier heads had an oval shaped pushrod passage cast into the head which did the centering instead of the rocker arms. There are some early heads from the 289 with larger valves and the small combustion chambers that should work on the 260. You just need to know what to look for.
The 260 is a sweet little engine. It even was installed in the British Sunbeam Tiger. Maxwell Smart's car on the old TV show "Get Smart" shows it on the intro to the show.
As for fuel milage, 18-21 MPG where? Highway only with a stiff tailwind, maybe.
ford 260 V8 questions 
. Lot of good information and great people 
. But if its a V8 you want, go for it.
