The single will be cheaper. 3.5" is probably overkill for your situation, but I like the way your thinking. A c body actually has a pretty good single exhaust, the Y pipe is more of a Y not a T as with later cars and smaller bodies to fit it in. My main point to OP is not to let a exhaust shop try to talk you into using 2" all the way back.
Yes, we're on the same page and paragraph here. My current exhaust is woefully inadequate, consisting of the Y pipe then routed into a SINGLE 2" PIPE! I suspect even 3" pipe is more expensive than dual 2" would be, due to the extra bend radius required for larger diameter pipes. A single 2.5" probably would be the most cost effective setup for a low-flow engine, with a radius of 1.25" still giving a decent cross sectional area. A single 3" w a 1.5" radius beats dual 2" (2.25"^2 vs 2"^2) here though, so IFF one can bend 3" properly for the contours of a 66 C-body undercarriage, with a reasonable cost, one may get a very good exhaust system with a single pipe.
516 heads, while providing the closed chamber for performance, are afflicted with undersized ports, and will require induction hardening for the seats regardless. Mine seem to be serving admirably enough for the present, with the 350 cfm WWC carb good up to 4000 rpm. Given the 2.76 rear end, on the interstate highways, this all makes for a nice cruiser; which is doubtless what the Moparian Masters of Yore intended.
I venture that the maximum practical diameter of a single tube constrains the cost effectiveness of such a system. Bend radius counts for a LOT in design considerations here. I've bent some fancy EMT as an electrician yrs ago, and while that stuff isn't precisely the same as exhaust tubing, there are similar limits on it.
I have 906 and 452 heads available also, with a late 60s "Commando" short block and a 400 respectively. My long term plan is to use the steel crank from the 383 short block (if practical) in the 400 block to build a most DURABLE B block engine with optimum low end torque and a bit of passing power, nothing fancy. I like the internal balancing of the steel crank and overall structural superiority over nodular cast iron, even if I don't plan on a 7000 rpm monster. NO STROKING! I may well use the 516 heads with the built motor, given the closed combustion chamber advantage for bottom end torque.
Much research, consultation and budgeting comes before any new plant gets dropped into Mathilda's engine compartment. But a new exhaust system is in the offing, God-willing, within the next 12 months....