Matt there is another option. First off get rid of the heat pump as already mentioned they dont work well in the north east. There is alot of them out there and they are even still installed but around here they need a back up and they just dont save anything.
You can do as you mentioned just replace the ac, and have a conventional furnace installed with it, this would be the most cost effective. But have you ever lived with hot air heat? It is the worst type of heating but it is the cheapest to install since all new homes have central air installed and thats why in this area its the most installed form of heat in new construction. You could take it a step further and yes it would cost more but you would not need a humidifier the air would not be dry like conventional hot air, and much better for alergies.
You would have the ac installed as normal but no furnace, a coil takes the place of the furnace then install a boiler run the coil off the boiler this is called hydroair, and to utilize the boiler install an indirect water heater which runs off the boiler, if you plan on finishing a basement you could run a baseboard loop off the boiler.
How does the house make hot water now? Is there gas which is less costley to install than a oil boiler. If you were to consider this option i would suggest using a sealed combustion boiler, taking combustion air from outside instead of from the house but not a condensing boiler as to expensive and no return because the coil is high temperature so the boiler would not condense. Ther are cast iron sealed combustion boilers, but if there is a chimney and its in good condition you could use that to save a few bucks but i would suggest the sealed combustion. Burnham has a nice series of boilers cost a little more but they have a great control you can install an outdoor reset for about 400 dollars and just need to run 1 wire the control is prewired and has priority control for an indirect prewired no additional controls needed so the extra cost is justified.
I dont work in your area but if you have any ? just ask.