I've been thinking about this pretty seriously lately. I'm off work with a shoulder injury and can't do much other than surf the internet and daydream, so this has consumed a lot of my time. I'm starting with used Redline that I bought from a member of the Sky forums. Let's say, for argument sake, that our starting point is a turbo variety Kappa.
I think it really depends on what your goal HP/TQ is, and what you might expect to do with it in the future. If your goal is less than 450 HP, I don't know why you'd even consider swapping out the LNF for a V8. It's relatively cheap and easy to get 400 HP out of the LNF. 500-550 HP (at the crank) is my goal. I don't plan on drifting, I don't race, I don't AutoX, so I don't have any specific race goals I'm trying to attain. This is not a daily driver for me, and was bought purely as a toy. My wife needs to be able to drive it too, so it should be able to be driven in something like rush hour traffic without burning the tires at every stop & go.
It is not cheap to get the LNF into the 500+ HP/TQ category with a reliable engine. You have to basically build up the engine, but once done it should hold strong for a long time. The cool thing about building up an LNF is that you can sort of piecemeal it as you go. Start wherever you want and add things as you go. Tune obviously being the first choice, then you can do intercooler tubes, pick whatever intercooler you want, pick your high flowing catalytic converter and exhaust system, and even a few higher performing turbos without needing to upgrade the internals. But when it comes to >450 HP or approaching 7K RPM you really need to build up the internals of the engine, maybe cams, probably fuel pump upgrades, etc... So now we're talking several thousand, plus a few grand for the turbo and tune. You can basically pay as you go with an LNF build as you approach 500+ hp/tq. Once you get there you have a great power curve from 3K RPM to 7K RPM. That's nice, but still has a bit of turbo lag. Not terrible, but it's still there. Benefits are having some of the highest HP to cubic inch ratios in the world, less weight (not that it matters much), the ability to keep your stock transmission and drive shaft, great mileage, the satisfaction of using technology to your advantage, and the unquestionably awesome sound of a turbo.
With a V8 conversion, you get zero benefit from your money as you collect parts. However, by my rough estimates, the price difference between building up a 500HP LNF and a 500 HP LS3/T56 conversion using a pulled engine are not all that substantial. Yes, the V8 is more, but not $10K more. Maybe not even $2K more if you're willing to wait for the right deals to come by. Buying a new crate engine and transmission is basically out of the question for me, and adds at least $6K+ to the costs. That's not really worth it for me, so used/pulled is where I'm looking. Granted, this is with me doing most of the wrenching either way, using the Werks V8 conversion kit. Someone that was more experienced than me, who wouldn't need the kit could get by even cheaper. But that's not me. I'd expect to spend quite a bit more on a conversion than it looks like at first glance, but who really knows until you start doing it. Benefits include recovering some of your costs by selling off the stock engine/transmission, no turbo lag, very linear power curve, much better transmission, greater potential upgrades, and the shocking sound of a V8 coming from a tiny roadster.
Now, here is where it gets unquestionable in my mind. If I wanted to get into the >600 HP category, with a still streetable power curve, I think the V8 is the way to go, both in terms of cost and usable power curve. Others might think differently. But how street friendly is a 600+ HP, 3000 lb car really going to be? It's not. It's going to be an angry, blood thirsty beast that tries to escape from you at every opportunity to kill all the small children and old ladies in the neighborhood. Sounds fun!
I also think that with either method, I will want/need to price out how much it would cost to pull the fenders so I can fit wider wheels in the rear. When you get to the >500HP range, or even close to it, I don't think there is enough footprint on the rear wheels to hook up. In my opinion, it's wasted torque unless you can get it connected to the ground. So now that we're talking about connecting that power to the ground, we're also talking about necessary drive train upgrades. Differential gears, axles, etc... so you're not turning your toy race car into a toy grenade. Now we're talking a few grand more, either way.
Either way you go, LNF or LSx, it's still going to be a unique build, with unique characteristics. Pic your poison. I'm still not sure what route I'm going to take.
