There's several engines to choose from that physically bolt in '67-'69 Mustangs. All Ford Windsor family engines bolt in directly with the right combination of parts, e.g. bell housing, transmission, etc.
These include 289, 302, 351w, 5.0L and derivitive engines such as a 347 (stroker 302). Note that a 5.0L is not the same engine as an early 302 although the block is quite similar. Basically the 5.0L is a roller cam version of the 302. These engines are considered small block Ford engines. In addition, there are other engines such as Boss 302, 351c, 390, 427, 428, 460 and some others that can also be supported. Boss 302 is a special engine developed in the late 1960's for racing purposes. It shares displacement with the other 302s but has significant head and deck height differences. 390 is an obsolete but popular vintage large block engine. I don't know much about the other big blocks. There is a general discussion of classic Ford engines on
http://www.fomoco.com A good guide to modern Ford engines is found in Ford's Motorsport (Ford Racing) Catalog. You can get a copy of this catalog at the parts counter at Ford Dealers for $5 (worth the $5). You can also find it at Mustang parts vendors.