V8 interceptor

The new GT500 (1967) featured a 428 in³ (7 L) FE Police Interceptor big-block V8.

Shelby GT500
In 1968 production of the Shelby cars shifted from his California site to the Midwest and more under Ford's control. The '68 car used a slightly modified version of the 428 Police Interceptor motor, and even a few had 390s due to a lack of available 428s. These cars still lost the drag strip wars to the top-of-the-line 396 Camaros. Later in 1968 the Cobra Jet motor became available in the model called the GT500KR. Only 1,314 were made in '68 including 381 convertibles. 1969 was the last year for Shelby production, although some of the cars were unsold by year-end and were then sold as 1970 vehicles.

428 Police Interceptor
The 428 Police Interceptor retained the cast iron block and heads of the stock 428, but featured an aluminum intake manifold.

Based on the stuff I have from that era, it appears that Ford installed the "428 8V special interceptor". This is important, as it basically means Ford assembled the base car complete with engine and major accessories, with only the Cobra valve covers and air cleaner potentially left to Shelby. Essentially a 67 GT500 was a 390 GT with a special engine (using the restrictive 390GT exhause manifolds and most of the exhaust system), and minor tweaks to springs/sway bars. The toploader was different because of differences between 390's & 427/8's input shafts. That Ford assembled the engine in its entirety makes a lot of sense, as the Venice facility was really spending time on the cosmetic issues of the cars, not the mechanical issues. Same also true for the GT350's, note that 67's no longer included headers, which was a time consuming assembly option. Heck, even lemans stripes were not put on (dealer option seldom applied). So it makes sense that the 67 428's came with the cam Ford (or Shelby) deemed appropriate, and that most likely was the 390GT cam (could have been something else, but it would have been an off the shelf easy to warranty cam - since Ford ended up making about 1500 428's complete with the 8V induction, a slightly different cam than the Thunderbird or Police version would not be a big deal. There would have been some sort of engineering spec for the "special 8V's" which would result in cam consistency for the run). The cam WOULD NOT have been replaced at the Shelby facility, that would have been way too much work (for 99% of the cars produced). Thinking about it, Shelby would have no business fooling around with engine/mechanical changes on what was considered a tight engine compartment back then (quite a few 500's had air conditioning), Ford would have to have been responsible for all basic plumbing/belts/wires/PS coolers and so on. Not to say the Shelby facility did not do a few (undocumented) one-off's to special customers, just the vast majority of the cars came out the same way mechanically. Ford was the one vendor Shelby dealt with which was capable of producing the same thing for the entire model year - the cosmetic items were another deal altogether.

1967 ENGINE - GT5OO
428 C.I.D./355 H.P. Ford 'Police Interceptor' short block and heads

C-6 'Police Special' in GT500

Real P code 428's had aluminum intakes, Holley carbs, and solid lifters.
How many 67 GT-500's have you seen with solid lifters?
Now I'm not saying that a few Police motors didn't possibly make it in some, as it already has been documeted that several cars were delived with 390's do to 428 shortage.
With Shelby, I have learned that anything is possible.
1968 early cars got the P code motor until the CJ became readily available