Old Windows or Original Construction Windows:
Typically, original windows have the lowest resistance to the transfer of heat and cold. Furthermore the weather stripping, or lack thereof, can allow vast amounts of heating and cooling dollars to leak out into the atmosphere.
To the right is double pane glass, but the sash is designed to hide the spacer strip between the two pieces of glass.
The idea of switching out your old single pane glass with newer double pane insulated glass is very good in theory. But in reality it is impossible to do. Window sashes are built with a ledge or mortise that accepts the pane of glass. This part of your existing window was made to fit a single pane of glass that is only 1/8 inch thick or so. If you put insulated glass that is typically 5/8 inch -1" thick in this grooved space, it will not fit.
You might consider making your existing mortise deeper to accommodate the insulated glass panel. This is not only very difficult to do without specialized tools, it will very likely ruin the interior profile of the window sash where the wood touches the glass. You will indeed remove some of this molded profile as you cut away wood.
The cost issue is also a factor. Clear insulated glass often costs about $10.00 per square foot. If you want higher performance glass that has the Low-E glass on it, expect to pay $14.00 or more per square foot. The Low-E glass is a very good choice because it helps save you money. This glass is covered with an ultra-thin coating of metal that allows the glass to repel radiated heat back to its source. This means heat stays inside your home in the winter but stays outside in the summer.