Excessive sludge found

Ok guys I removed the timing chain cover with the intent to of course replace the timing chain. Well when it came off I was almost floored by the amount of sludge I saw. I couldn’t even see the oil pressure sensor element or what ever it’s called. I started to scrape it away and it must be a good 3/8 thick. It’s a 289 in a 65 Mustang. It also makes a knocking noise when running (when I could keep it running). Does anyone have any opinion on products that are supposed to remove sludge? I’m also considering just replacing or rebuilding it.
I know this is pretty long winded but I Ned advice bad.
 
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At this point I would suggest a complete rebuild due to the fact with that much sludge you would not have been getting proper lubrication and likely need main, rod and cam bearings replaced at the least. Possibly need cylinders honed or possibly bored to a larger size cause your pistons were likely starting to seize.
Now with that being said you could try what we did back in the day and mix one quart of kerosene with 4 quarts of oil and run your engine with that mix till its warmed up good and then some. Drain that concoction and you should see plenty of that sludge come out. refill with fresh oil and filter and see how it acts. This has revived many a sludged up engine provided that the engine wasn't severely damaged.
 
At this point I would suggest a complete rebuild due to the fact with that much sludge you would not have been getting proper lubrication and likely need main, rod and cam bearings replaced at the least. Possibly need cylinders honed or possibly bored to a larger size cause your pistons were likely starting to seize.
Now with that being said you could try what we did back in the day and mix one quart of kerosene with 4 quarts of oil and run your engine with that mix till its warmed up good and then some. Drain that concoction and you should see plenty of that sludge come out. refill with fresh oil and filter and see how it acts. This has revived many a sludged up engine provided that the engine wasn't severely damaged.
I finally got the oil pan partially out (the bolt on side for the cross member won’t come loose). I’ve also heard that people have been known to run diesel fuel in the crankcase for a few seconds but I don’t think I will go that far.
 
I finally got the oil pan partially down ( the bolt for the cross member on one side won’t come loose). I’ve also heard of guys running diesel in the crankcase for a few seconds. I got the timing chain replaced and was surprised that the dots on the sprockets lined up because it ran like it was way out of time.
 
My thoughts are that if it has a bad timing chain and makes a knocking noise and is full of sludge them your best money and effort will be spent pulling it, disassembling it and at least do a refresh on it. If it is an old engine that has been poorly lubricated for a while your cam and bearings probably aren't in the greatest shape either. If you are successful in loosening the sludge up, it has a good chance of moving and stopping something else up like an oil gallery or the oil pump. It would take a little longer and cost a little more but getting your engine right now would pay off and be a relief in the long run.
 
If you can remove and replace the oil pick up screen or pump and screen with the pan partially down, I suggest you do it.
Chances are the oil pick up screen is clogged as well.
Had a similar problem many years ago with a factory 289. Factory screen had a bypass in it. When screen clogged bypass opoened up and all was OK until a chunk of broken valve seal caused the pump to sieze and the distributor shaft to break.
 
I did not realise it was available with a hardened shaft.
I would stick with factory shaft. If the pump jams because something gets stuck in it, I rather have the shaft break than the gear on the distributor or cam.