I agree that the valve seals are bad. The smoke when gassing it when cold could also be worn rings. This isn't a major concern if it stops smoking after warm up. You will get a puff of smoke when accelerating from a brief idling period with worn valve seals even after warm up.
You should not be smelling any exhaust if the car is in good operating condition. You will start getting headaches and nausea if you drive with the car the way it is. Of course you know what happens to you if you inhale too much exhaust. Get the exhaust system checked out as a priority. As said before, the condition of the engine and the emissions it puts out could be a factor.
The power steering system has a control valve located in the center link that is connected to the Pitman arm at the steering box. There is a grease fitting on the control valve that often gets over looked that will cause this joint to wear and cause play in the steering. The steering gear box can also have wear and slop. So either the control valve is worn or the steering gear is worn or both. You can do a limited amount of play reduction by adjusting the small bolt on the top of the box, but you shouldn't be going too far with this adjustment because this would indicate a worn out steering gear.
It may be a good idea if you can also check where the steering ram (the hydraulic cylinder) anchors to the frame/body. There is a set of rubber bushings that will rot from age and exposure causing play. The bolts that hold the steering box in place need checking for tightness, they will work loose after 40 years. All total all of the steering joints need checking for wear as they will contribute to play in the steering.
The power steering systems on the early Mustangs were never very good. There is a lack of feel in the steering which was considered normal. We went to the moon during this era, but by looking at the design of these P/S systems, you'd think that we were in the Middle Ages. It wasn't just Ford that was using this design either.
I can't tell you about any mechanics in your area, but you may be able to find one by contacting your local Mustang club. I wish you luck on your project of love. All of the best, ---Chuck |