If I understand your first question, there are many differences between the Gen II and Gen III engines. The 5.0 is the traditional small block with some improvements to the original 50+ year old design. The 5.7 LS Vortec, along with the 4.8, 5.3, and 6.0 is a clean sheet design with a totally different look
Not sure if you have to mod the driveshaft. If anyone doesn't chime in, maybe you can Google the info if you haven't already.
You will need to modify the existing LS engine harness, if you get one, or buy an aftermarket one . There are companies out there but I've heard Nelson Performance does a great job on them. You will also need to have the PCM(computer) from the LS engine, and that will have to be flashed to remove the VATS and any thing else you may want to remove. Nelson does provide this service too.
'93 Chevy 1500 4X4 ECLB with a '99 Silverado LQ4 6.0 and '99 Escalade 4L60E. SOLD IT!!
New toy: 2001 2500 HD 4X4 Extended Cab Long Bed
John