I am not sure about anything surving too long cycling back and forth with the bolt though Driller.
Those peep sights mount on a bridge over the rear of the action. A red dot could mount the same way maybe. Then it wouldnt be flopping around all over the place.
Or maybe you could knock the rear sight out and mount a Dr. Optic in there.
You could even just use a universal barrel mount and a bit of inletting on the forend to allow for it to sit up tight against the front edge of the receiver. If you really wanted to get serious you could glass bed it all together.
But if you wanted to be really badass, you could put an AK/SKS side rail on the receiver and mount some crazy russian red dot!
Then you could swap it out for a POSP scope for long range shots, or night vision even!
(Hehe)