Tinkerr,
I'm not up on 69's as much as 68's, so what I write here is only a guess. 69 experts, please fix my mistakes!
I believe the lowest axle ratio you could get with the 396/325 and the M40 (Turbo 400) was 3.31. If you wanted lower gears than that, I think you had to upgrade to the heavy duty (or "High Speed") Turbo 400 that was standard on the 396/350 and 396/375 cars. This was a different transmission with heavy duty parts (see the product bulletin attached).
Because there were only so many combinations available for speedometer gears (due to physical size and teeth count), very low axles used a speedometer adapter to convert the output of the transmission speedometer gear. For example... Notice in the chart above that all heavy duty turbo 400's use the same 8623311 drive gear, and that the 2.73 axle and 3.73 axle use the same 9774413 driven gear. How can this be? If you used this combination in the 3.73 axle car, the speedometer will be WAY off!! Howver, by the use of a reducer (adapter) for the 3.73 axles you can use the same combination and still get accurate speedometer readings. Boy, those Chevy engineers were sharp, eh?
So in your case, with a Turbo 400, F70-14 tires and a 3.37 axle, you're going to need a 16 tooth (orange) "Drive" gear, a 34 tooth (Light Green) "Driven" gear, and a 3932220 adapter (reducer). That's going to be the hard part, finding the adapter. They come up on ebay periodically, so check often.
Hope this helps, and like I said, if I made any mistakes (which is VERY possible), some of the 69 guys will correct me.
Ed
