If you want to lose weight it is a simple formulae: Decrease caloric intake and increase exercise intensity and duration. For me, I cannot decrease the food intake very easily, as I don't overeat. I just crank up the mileage. You have to ride a lot to offset the increased hunger.
Looking at the photos, I would keep the frame and wheels, get a new modern drop bar and brifters, and any drivetrain parts to make it functional. Also think about pedals and shoes, shorts, gloves, and maybe a quick saddle adjustment (your saddle clamp is backwards for most people, hard to say without seeing you on the bike. Look at good riders about your size for fore and aft as well as leg extension). Personally, I would ride the wheels off a bike like that. Nothing wrong with it if you are comfortable on it.
By the way, nice looking handlebar conversion.