you have to drain the radiator to remove the water pump, so why not remove it for the extra room? i've done a few cam installs on late model GTOs (much less room) and all we needed to do was remove the radiator and left the a/c compressor up a litte to clear the removal path.
you didn't mention it, but are you replacing the oil pump and timing set while you're in there? the lift isn't super-aggressive, but at almost .600" it would be a good idea to replace springs and pushrods?
who's doing the tune?