Looking to replace original 304 engine in '78 Scout with a new, more environmentally and fuel friendly engine. Any ideas?

IHC made a slant four cylinder engine, and a 266 V-8 that would bolt up.

you have 3 factory choices to replace the V8. 196ci Slant four, the 258ci inline 6, or the nissan diesel (turbo and non-turbo) They will all more or less bolt up. the 196 would be the simplest as it is based on the v8 block and would mount the quickest. If you really want to save on fuel there are some who have modified the truck enough to mount a 4bt cummins diesel. Commons parts and good fuel economy. If you are partial to your v8 try installing a hamilton fuel injection system. They are made for the IH motors