I do not know how the return line feeds back into the sending unit, but it should not do any harm to cap the return line at the sending unit. However...these sending units are rather pricey, so try to do without damaging the sending unit.

I do not know what line sizes are available for BB Chevy fuel pumps, you'd need 5/16" x 5/16" x 1/4" to match up with the stock Pontiac lines.

If your fuel pressure is properly regulated to no more than 4.5 psi if you have a Quadrajet, then a mechanical or electric pump will work equally well with a good carb. If your fuel pressure is not regulated to this level, invest in a regulator.