Need Help with My $400 94 Truck

So I bought my 94 C1500 Ext Cab 2WD (auto) for $400, when I bought it I knew it had Trans issues, 3rd(D) slips like it isn't even there. I have no Idea of OD it there or not, never got the truck going fast enough. On the way home the Engine started to sound like an air compressor, sounded like it was coming from cyl 1. A compress test put cyl 1 @ 90 psi, with the rest I tested at 120psi, Changed the Plugs because they had some kind of Build up on 3 of them. I am in the pulling the motor, since I am sure it is a bottom end issue.

I am pretty sure the trans is a 4l60, since the linkage looks all mechanical, and their looks to be a single plug with two wires near the tail shaft. I was wonder if I can get a 4x4 trans to bolt up, or if not what vehicles to pull from the junk yard.

I have also considered a Manual trans swap if I can find the parts at a good price.

I am still on the fence if I want to rebuild the motor or swap in a different one. If I could find one locally I would swap in a 4.8L.

I have never rebuilt a Small block chevy before, I am more familiar with Wankel rotary engines.