IIRC the V8 has some hard lines along the passenger side firewall aft of the head, right above the valve cover fasteners . . . raising the engine is the ticket? Or lowering? If you cant get clearance for tools, then this is a problem. Even if you did get it dead on center, it could still be an issue with misuse of extractors or even broken drill bits. Im usually one to take the risk, but even so I have gone to a machine shop from time to time after a broken carbide bit in a sheared valve cover fastener in a head or for some other seized fastener.
As for attempting removal in-situ, the previous replies are pretty much on the money. However, welding would be risky on such a small fastener that is just above or flush to the machined surface of the head and I would only go with TIG and an operator that pretty much does it for a living. There is a not-insignificant risk that welding would damage the machined surface of the head, which could place the head completely out of machinable spec. TIG and operator skill mitigates this risk somewhat.
The only bit you should bother with for material removal is a carbide tipped or full carbide OAL bit in right hand. Reverse/left hand bits need to be able to flex a bit and are usually some type of high speed steel.
Extractors/EZ Outs are designed for use in the circumstance where the fastener shears due to over application of torque, not corrosion. So skip this all together as mentioned by other members. Good advice, dont get tempted into it.
Broken tooling needs a machine shop that can extract it or use a EDM/MDM/tool disintegrator. Pretty slick, there are portable EDMs, but these would not work here as the electrode needs to be on center with the fastener.
If the drills cannot be placed dead center, this is going to be a rough one. Nothing a time-sert couldnt handle.