All the '79 Chrysler 300's came with the 360 motor, this fellow says it has the original 318.
Everything else points towards it being an actual 300 painted blue, has the correct interior, grill, even details like the 300 stencil on the opera window. Even has the correct wheels and the red white and blue graphic strip under the opera window.
My guess is buddy has no idea what he has, likely purchased the car with the aftermarket air cleaner on it.
That air cleaner and the blue paint job are the only deviation from an actual stock '79 300.