Hello Hack,
Seems to me that you might need to do a little more refining of your "specs". You have stated that you want to use the 6.5 ?? cartridge in your Yugo 48 Mauser for hunting and that you want to use the 120gr bullets. What kind of distance do you think you'll normally be taking game? Barrel life may not be an issue since you're using it for hunting, but what kind of life do you expect? How much work do you really want to do to create the loads? Will you be single loading or mag feeding the rounds? Just some questions for your thought.
I shoot competitively and I choose the 260 AI because I wanted something that would easily fit into (and be able to be removed from) a short action (single load only). I wanted to have less barrel heating and more barrel life than the 6.5-284, but with similar ballistics using 140gr bullets for long range competition. I think I've succeeded... My 260AI shoots the 140's @ 2800fps (close to the 2950fps of the 6.5-284), it fits the short action well, and barrel life is looking good (only time will tell!). However, case prep is a PITA! For any AI, you'll be loosing barrel life, wasting time, and shooting up $$ in components that could be used for real ammo... all to fire form the brass. IF I were to do it again, I'd choose the 6.5x55SE, use the excellent Lapua brass, and be done. Same ballistics as the 260AI without the hassle... I've never heard of anyone (yet) that needed to open-up the bolt face to accomodate the rim.
Here are some thoughts...
If you're mag feeding the rounds, the AI cartridges won't chamber as well as rounds with 30 degrees or less of shoulder angle as the chould can catch on the feed ramp.
I believe the Yugo 48 uses a control feed bolt head, so rebated rim cartridges (6.5-284) may not feed well.
120gr bullets are great and there are several choices, but if you are planning to shoot beyond 300 yards or so the 140gr bullets are much better ballistically. Also, energy on target falls off rather quickly with the 120's due to loosing speed.
A straight .260 Rem is no slouch! Yes, it's a little slower than the 6.5x55 or 260AI, but only by 70-100fps max. Brass is easy to get or make (I neck down Win 7-08 brass) and relatively inexpensive. It's perfect for shooting the 120gr bullets. It will kill anything in North America effectively with a well placed shot.
Finally, if it were me and I wanted a 6.5 caliber for all-around hunting, I would choose the straight 6.5x55SE. It's been doing the hunting thing quite well around the world for over 100 years and it's still very effective. And, in a pinch you could probably find a box in the store on your hunting trip if needed.
Hope this helps...
Doug