I’d advise getting an over-the-strings pickup and brace like they used for old jazz archtops. Less cutting means less interferring with the bracing on the guitar, which means less ‘loss’ of acoustic tone and less likelihood of it turning into splinters when you put string tension on it. Your output would be basically like a cello or contrabass output jack (mounted to the top) and you’d probably have to get creative with the tone/volume.

Alternatively, you can mount everything on a gigantic pickguard but that monkeys with the balance of the guitar.

As far as electric strings on it, it’ll sound majorly thin as just an acoustic. I’d recommend 80/20 acoustic elixirs as they sound good on both acoustic and electric guitars and play pretty darn close to an electric.

nooo 80/20 is a phosphor bronze string type (http://www.amazon.com/Elixir-Nanoweb-Bronze-Acoustic-Strings/dp/B0002E1O2C)
and the pickup would either be something like this: http://www.lollarguitars.com/blog/tag/archtop/
or similar to the bridge on that, but with longer arm-rails that would extend over the strings. It would probably have to be custom made.