I have a 99 version of the 5.7 vortec, I don't have "cat" converters, nor do I run any of the emission equipment or sensors, I don't have rear 02 sensors and my PCM has been programmed for all of that. I don't have EGR active either. I'm running a toyota 5 speed, I don' t have to pass emissions testing.
If you have to pass emissions testing you have to understand what that means in regard to engine modifications. I suspect to pass CA emissions with a swapped engine...that means you will need all the emissions crap as the OEM donor vehicle had. If you want to max fuel milage I expect you will have all 4 02 sensors in operation along with all emissions crap that the PCM expect to "see". I would also presume you would need to run the matching transmission off the particular engine in question however it was configured OEM from GM.
I have pretty good power (no clue as to real HP numbers), my fuel milage is not much better than stock, but engine runs strong and I drive it mostly on the trail etc. I really don't care about fuel milage as long as its reasonable for a 4*4 brick with 4.88 gears and mid size tires.
If you have to pass emissions in CA you better stop and assess that number one....then find out what you can do in regard to engine mods. Bottom line...the electronically controlled engine...will run most efficiently with all the crap it came from the factory with.... minor exhaust mods might improve that a little bit.. if you are talking about something that is driven a few thousand miles a year...why chase fuel milage.
I think you will end up with a stock configurage to pass CA smog ref...but thats just what I think and I don't live in CA nor do I have first hand knowledge of the rules there.