Step 1: Research. The following books will have tons of info for you to absorb; they're both very worthwhile for anyone who has Weber carbs on their ride.
http://www.pelicanparts.com/catalog/shopcart/9144/POR_9144_documt_pg2.htm#item8
http://www.pelicanparts.com/catalog/shopcart/9144/POR_9144_documt_pg2.htm#item9
The stock 1.7 distributor is fine; use the stock timing specs (27 deg BTDC @ 3500 RPM, vacuum hoses disconnected and plugged). If you can find good taps for manifold vacuum and for "ported" vacuum, you can even hook up the vac advance and retard which is not a bad thing IMHO.
The stock 1.8 distributor would be better; use the stock timing spec (I think 7.5 BDTC @ idle).
The Mallory is very highly recommended by Raby, among others.
The MSD works with any of the above. It's OK, probably a little benefit but not a whole lot. (Crane's HI-6 is about the same thing.)
A lot of people are not very fond of hydro lifters. So a search here ("hydraulic" or "hydro" should do it) and you'll see some of the arguments.
--DD