Keep it tuned up with new ignition points and plugs every year. keep the tires up to 32 lbs and drive slow letting off the gas early, the air cleaner is minimal and you won't notice the difference..
also it must be a 64½ D code if it has the original engine..
I think the biggest problem/solution is the transmission. For the last 2 weeks I've been driving my dad's '67 Mustang with a 4 barrel carb and stock C-4 automatic, which is a 3 speed. I've noticed that 1st gear is way too big: almost like starting out in 2nd, and 3rd gear is too low for the freeway: I think the engine is probably revving at 3,000 rpm at 55-60 mph. I think the car averages 17 mpg. In my opinion, it would totally be worth the cost to upgrade to a newer transmission with better gearing. There are conversion kits available that allow you to install either a 4-speed automatic with overdrive, or a 5-speed manual. However, in your case, you would need to change the engine too. The 64 models had 5 bolts attaching the transmission bellhousing to the engine. From 1965 to 2003, those engines had 6 bolt bellhousings. The early Mustangs are quite easy to work on, so any shop should be able to perform the conversion. You can find the brackets you'll need through vendors like Mustangs Plus.
While K&N air filters have benefits of excellent filtration and air flow while being backed with a 1,000,000 mile warranty, K&N performs extensive testing on all of our products before they are released. These tests ensure that our filters provide sufficient capacity and efficiency, and provide an increase in vehicle horsepower. We do not claim that fuel economy is guaranteed to increase.
The U.S. Department of Energy has issued a list of recommended maintenance items which can improve your vehicle’s fuel economy. This list can be found at http://www.fueleconomy.gov/feg/maintain.shtml. One of these recommendations is to periodically check your vehicle’s air filter. Replacing a dirty, clogged air filter with a clean, free-flowing filter can significantly improve your vehicle’s fuel economy, according to the US Department of Energy.
Fuel economy is a factor which is very hard to estimate. K&N does not have the equipment or facilities to test for possible changes in fuel economy. The vehicles used in our testing procedures are loaned to us by customers local to our R&D facility. Typically, test vehicles are kept for 4-5 days at the most. A thorough fuel economy test can take weeks to complete, and variables such as vehicle load, driving conditions (uphill, downhill, wind, etc.) temperature, grade of fuel, and vehicle modifications are difficult to factor in. Over time however, one generalization has proven to be true: customers with more aggressive driving habits typically see mileage decrease, while customers with more conservative driving habits often see mileage improve slightly.
Best bet is to up-grade to a good electronic igniotion, that is, get rid of the points. Go to any speed shop and they will hook you up with a new distributor that will cost a couple hundred, but will gain you 30-40 horsepower, and 5-6 mpg.