My case is a bit different because it's part of fitting later axles to a 109 - I have a Discovery front axle and an early 110 Salisbury rear axle. I am using the Discovery braking system throughout to make sure I have suitably balanced brakes - the maximum gross weight for a 109 is only 50 kg heavier than that for a Discovery, and given that the 109 will be slower than a Discovery and isn't used for towing boats, big caravans or horses, should be more than up to the job. The only snag was that using Discovery rear discs would have required a lot of skimming of the calliper brackets to get the calliper to line up with the disc, but using front discs (I think they're also used as standard 110 rear discs) allows the calliper to fit with a shim between the bracket and axle flange.
Master cylinder pressure is, as you noted, critical to good brake operation. Disc brakes use less fluid transfer but higher pressure than drums. You might need to replace your master cylinder, though you already have front discs, so I suspect the mc will be fine and that you would only need to replace the pressure reducer in the rear lines for a more modern one. Have a look at the axles section on my blog to see what I have done (I know some other people have done the same thing too); www.nickslandrover.co.uk
If in doubt, then refurbishing your existing system with good quality standard parts is the safest option, like you have already suggested. The drum brakes should work well - they just need more cleaning and adjustment, while discs are largely self-cleaning and are self-adjusting.