if it is I'd like to go with a 67-70 to pick up a little more tire room.
The narrower rear end will not increase the "tire room". It will only change the backspace requirement for the wheels to keep the tire centered in the wheel house. With the narrower rear end you can use wheels with less backspace for that "deep dish" look that was popular in the 60's and 70's.
A narrower rear will move the wheel/tire in, which means less sticking out pass the wheel lip. I did the same on my GTO and can now run little wider tire underneath the car. Just wasn't sure on the mustang whether the 70 rear would bolt in without mods. Hemikiller is confident it'll work, so I'll give it a try and post results. Thanks!