Convert hybrid to cross bike

[cruezr]

Have been riding my 2000 Giant Option Hybrid bike the last few weeks and now thinking of converting it to a cyclocross bike.
Current specs are listed below. Need a bit of advice on best course of action to undertake this little project.
I know that I can reduce tyres from 40C to 32C and replace saddle easily enough.

Frame & Fork
Frame Construction TIG-welded
Frame Tubing Material Chromoly seat tube/hi-tensile steel
Fork Brand & Model Giant
Fork Material Chromoly, unicrown crown
Rear Shock Not applicable

Components
Component Group Mountain Mix
Brakeset Aluminum linear-pull brakes, aluminum linear-pull levers
Shift Levers SRAM MRX
Front Derailleur Suntour XR-05 F
Rear Derailleur Shimano Altus C90
Crankset SR XR120, 28/38/48 teeth
Pedals Resin
Bottom Bracket Cartridge
BB Shell Width Unspecified
Rear Cogs 7-speed, 14 - 28 teeth (14/16/18/20/22/24/28)
Chain 1/2 x 3/32"
Seatpost Aluminum, suspension, 30.8mm diameter
Saddle Giant Spring Comfort
Handlebar Aluminum, rise
Handlebar Extensions Not included
Handlebar Stem Steel
Headset 1 1/8" steel

Wheels
Hubs Alloy
Rims Alloy, 36-hole
Tires 700 x 40c Cross Comfort Anti-Puncture
Spoke Brand Stainless steel, 2.0mm straight gauge
Spoke Nipples Brass nipples

Thinking that I need the following - drop bars with 7sp STI levers, new head stem/extension
Otherwise strip back to frame and start with upgraded groupset (2nd hand Tiagra or similar)

[boyracer]

do eeeetttt!
get rid of any weight you can..suspension post/steel stuff.....although mine weighed 11 kg on raceday.

[Nobody]

Might be better off just buying a secondhand 'cross bike. Chances are if the bike fits you now, the frame reach will be too long after you install a drop bar with its extra forward reach. You generally need a smaller frame for a drop bar bike.