If I were you, I'd build a sleeved 9:1cr LS motor. That would be the most cost effective and durable way to break the 350hp limit reliably. Getting a LS motor sleeved is less expensive than buying a complete GS-R motor. Depending on how you acquire it, that sleeved LS motor could very likely be the most durable and cost effective alternative of all. Expect to spend at least $3000 building a 350hp 4-banger.

Displacement might be king, but forced induction really re-writes that old rule. The LS motor is a solid (and cheap) platform for turbocharging. If you want low-end power, just pick your cams and turbo wisely because that will have more to do with your power curve than anything. You need cams that provide just enough duration, allowing your head to flow the amount of air that your turbo's moving or your bottom end will suck. A little lag is a good thing in a FWD turbo setup. Too much low end power sucks with FWD traction. Too big of a turbo can make you blow the tires off every time it spools.

It all has to balance out, and it sounds to me like you've got a lot of homework to do. Most machine shops will help you put something together if you can just bring them the core. You'll probably find the most info about the B18 series engines.