[autobonrun]

Sounds like you're willing to do some work yourself. If the engine is running fine, I'd hold off on the mechanicals. From your post it sounds like the fiberglass flares and the fact that it is not period correct bother you.

Typically, the average mechanically inclined individual can do some electrical and engine work, but body work takes special tools and a place to paint.

I'd recommend first having done the things that you can't do yourself. I would first get rid of the fiberglass, add metal fenders, and paint it the color I liked. Probably $4-5k on this.

How much of the carpet that needs replacing is actually glued to the floor versus the carpeted floor mats? Try cleaning and re-dyeing the fixed portion and buying matching floor mats to replaced the damaged ones. Should able to get by inexpensively at less than $500.

Buy some inexpensive used seats in good condition and put your originals in storage until you decide whether to have them refinished or replace with an upgrade. This way you can still drive the car while the seats are being refurbished. Or if having the seats period correct is not an issue, go ahead and upgrade to Recaros or similar. Upgraded seats can be expensive so you need to decide which path you want to take before you spend anything on these.

Take the other $3000 or so and set it aside until you see what mechanicals you wish to tackle in a year or so. By then, the amount available to spend will probably be back up and then you can consider engine work. Although I'm not sure what you mean when you say the engine is tired. I don't think 220k km is that bad; that's like 135k miles if my math is right. Maybe it just feels tired because you don't like the way the car looks. Have a mechanic you trust run a compression check and see if it really is "tired" and what else is wrong.

Before you start down any path, decide how important it is for the car to be period correct. This will dictate what gets replaced and what gets updated or refurbished.