Mine cracked inside the #8 cylinder. My year (98') was more prone than yours. Mine too had the same symptoms which is why I mentioned it. It would start and run rough for 10 seconds or so after leaving it overnight. And, like yours sometimes it wouldn't do it at all. I have since determined that...
I would remove and CLEAN all the ground wires and studs they connect to. Also, I would make sure that your charging system is fully charging good batteries. I would do this prior to worrying about the codes. As far as the smoke, I would check for a cracked block. Mine had the same symptoms...
I believe that the torque converters are different plus, I'm with AK on this one. The smaller transmission won't hold up. Suggestion: since you already have a 6.5 ready to go, why not just find another truck (they're out there) that's already a diesel that has a bad motor? That way you can have...