Yes, all of your conclusions are correct! You might shoot a .357" wadcutter bullet, but not accurately! A .38 Special case can be sized down to fit the chamber, but you will need a heeled bullet to fit your bore. I can't tell you what your bore is, but I can tell you it will likely end up around .375", as that's what mine is with a nearly perfect bore. My old Ideal mold drops a .376" bullet with a .356" heel. You will need to slug your bore to see for sure what it is, and then pick a mold to cast these.
NEI, Accurate, and other custom mold makers can build you a great mold. The twist rate is slow, so it needs to be around a 140 gr. to shoot well. I don't know anyone selling cast bullets, so if you don't cast, you'll probably need to start. 
You can also find an old Ideal tong tool in .38 Long with a mold on it possibly. That's what I have used for years, and it works great.
I charge mine with loads equal to data for the .38 Short, or light .38 Special loads. 5.0 grs. of Unique, or 4.0 grs. of Green Dot with the 140 bullet makes a nice mild load and not an issue for the #2 Ballard.

Glad to help Bill! I love the .38 Long and the .32 Long in Ballard rifles. Been loading both for several decades.

PS-A fun load for plinking are round balls! Back before I had a bullet mold I used to buy .375" round balls to shoot. I sized the cases and charged them with 3.0 grs. of Unique. Then put a dab of Lee liquid alox on a ball, and set it on the case mouth. Let them dry overnight, and they were stuck in place. They're fairly accurate to 25 yds., and a lot of cheap fun. Did the same with .32 caliber round balls and the .32 Long cases.
If you have a re/de-capping tool you can also reprime the cases, and charge them at the range. Then sit a round ball on top and chamber it. You can shoot all day with one case this way.

Groove diameters vary a lot with these rifles. I have always advised shooters to try the HBWC route, but it does not work in my own current rifle. Rifles marked .360 no5 usually have a groove diameter around .372" and the HBWC works. Rifles marked .380 long may be the same, but many have a groove diameter of .375 and this seems to be just too much for the HBWC to expand enough. 
I started 20+ years ago with a .360no5 and purchased the correct heeled bullet mould. Then I discovered that it shot better with the HBWC. Now I have a rifle which is marked for both calibres and will only work with the heeled bullet.
Also, 38 Special brass is a little loose and some blow back occurs which affects accuracy. The cure for this is 38 S&W brass.
Fred.

how about breach seating?