Your bottom bracket seems low to me. I'd be concerned about pedal strikes even with the shorter crank arms.
A taller wheel/tire size would bring everything up.
So would a fork with a longer axle to crown measurement. But, I gather your stand over height doesn't allow for much of either.
Something about this whole thing seems "off" to me. Can you post pictures? Rims lining up with brakes would be a sure-fire way of getting in the ballpark WRT wheel size & Terrys aren't known for toe overlap or other fitment issues. IOW: She knew what she was doing....Are you sure this is the proper OEM fork?
I just feel there is more to this somewhere.
What is this '"80's road frame you found for cheap?"
I would default to these guys being an authority on the matter.