I gave it another try with Ernie Alston's ISG FMC and it wasn't able to drive the heading bug. Not in heading select, turn more or the external mode (the one for using the INS). I can see that upon engaging LNAV, that is tries to move the heading bug, but it's being reset with a split second. I don't have the GTN750 from RXP, but as it also uses the method of driving the heading bug, it won't work either.
As far as realism goes, I guess it's not realistic to have an FMC in your DC8-50. Some DC8-70s had an FMC installed (maybe retrofitted), but since this is a 50 series DC8, I can live with the compromise of having an FMC in my DC8-50. This setup will allow me to enjoy this great aircraft online and expand it's usability.