Customline3859. Welcome to the site. John's info above is good. My reply took longer to type and elaborates a little more. Yes, your 292 engine block can be bored oversize for use of 312 oversize pistons. IF your 292 block has already been bored .060 over, the cylinders now measure 3.810 which is the equivalent of a .010 overbore for a 312. In using 312 pistons with a 292 engine crankshaft there is no interference issue with the crank that requires the use of 312 length connecting rods.
I've previously found oversize pistons for the 312 offered and available in .030 (3.830), .040 (3.840), and .060 (3.860) oversize from Sealed Power and Silv-O-Lite. Both piston makes state on the shipping box that the piston pin height is .020 less than original FoMoCo dimension. Use of these pistons will increase the 'in-the-hole' dimension of the piston in the engine block (below the block deck surface). Because of this factor PLUS the original FoMoCo 'in the hole' production dimension of .020 - .030 AND the use of today's composite cylinder head gaskets, I would recommend having the block decked to zero deck the pistons. This will improve engine performance, but more importantly will prevent detonation problems with a piston quench dimension that would approach the critical number of .060 IF block decking is not done. With heat cycle factors AND original production inaccuracy, squaring the block by decking is a GooD thing to do. I think you will be surprised by what the machine shop finds in checking the variations from square in machining your engine block.
Because of the amount of over-boring you may need to do to clean-up the rusted cylinder bores, consider having the block sonic tested first. Core shift in the engine block casting process could be a concern with how much the original 292 is being over-bored to use the larger 312 pistons.
Having the entire engine rotating assembly re-balanced after changing pistons will serve to insure an engine that runs smoothly and provides longer trouble free service than you would experience otherwise. Original FoMoCo engine balancing was not the optimum from the mass production system of the '50s and early '60s.
Check the link below to see how much the composite cylinder head gaskets you use will increase quench area and increase effective combustion chamber volume over the original steel shim cylinder head gaskets used as FoMoCo original equipment. Composite gaskets provide a much better assurance of a lasting seal, but they do increase quench dimension and lower the engines original static compression ratio.http://www.eatonbalancing.com/2012/06/30/head-gasket-volume-calculation/
Some GooD tips on y-block engine rebuilding may be helpful to you from the links belowhttp://www.ford-y-block.com/assemblyerrors.htmhttps://www.hotrod.com/articles/build-reliable-powerful-ford-y-block/
Hope this helps!
a.k.a. Charlie Brown
near Syracuse, New York