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@TheBrick(Tommy)
Yeap I got my frame from the dump, it is crap though, but it does it's job :). Just head to the edge of London and most tips will let you buy stuff off the guys, haggle though. Bexley for one.
to get the cranks off you will need a crank puller, this is a cheap tool that you will use loads about 10-15 gbp.
You MAY need to remove the cranks to replace the b.b to sort out he chainline when you have built your read wheel, do not try and ride it with a dodgy chainline, but you may be lucky and beable to place the chainring on the inside of the spider. If you have to replace the b.b this is where you may run into trouble 1970's Peugeot has a high chance of having a french b.b, if so your best bet is taking it to a desent bike shop and get then to reshread it to italian threading then you will have a selection of b..b lengths to choose from.
For a cheap wheels these hubs are cheap
http://www.sjscycles.co.uk/product-SJSC-36-hole-SJSC-Double-Fixed-Large-Flange-Track-Hubs-with-high-quality-sealed-cartridge-bearings--Polished-Alloy-finish--per-pair-11137.htm
£40 for the pair plus two open pro rims 2 x £18 + spokes £0.3 x 36 x 2 = £97.6
This is really cheap and if you look after them you and transfer them to your next bike. The wheels will make a massive diference to your ride and will be the most expensive thing on your bike, do not try and cut corners it will work out badly in the end. £100 for a pair of wheels is cheap save up get a job if you don't already have one beg what ever but a half decent set of wheels are worth it.
lastly don't cheap out on your cog buy a good one add a lock ring.