Martin,I know much has changed over time and that you have already replaced the electrics which will make the machine much better (modern steppers would also improve performance). The Z axis would certainly be improved with a ballscrew, although many machines run quite successfully on trapezoidal leadscrews. The Z axis travel is very short, so I do not know if the "skinny" unsupported rails are likely to cause you a problem, depending of course on what you are cutting.
Out of interest, did Stu alter the Z? or is it still as original. I knew someone who was running one of these machines 20 years ago, and he is still full of praise about how good it was.
Anyway, good luck with whatever you do and I look forward to hearing you are soon up and running. G.