omg...and your a senior member? is this your first b16 swap? yeah i thought so. the reason why b16s are quicker then other 1.6 or a little higher is because of the gearing. (not the only reason but just bear with me) quicker gearing means more time in the sweet spot. the sweet spot is higher revs. your 17s are only hurting you "high rpms" if the overall diameter of the rim tire combo is smaller then your stock factory rim tire combo. more then likely thay are 205 40 17...which is only slightly smaller....enough for a 5 mph change at 60 +.
your flywheel makes no diffrence at alll........if you dont like it...get a ls trasnny or even better yet ls final drive put into your b16 tranny. the rpms will only come down like 500 to 100 rpms in your fifth gear. think of it this way. your car redlines at 8200 so 4000 rpms is okay...since that is half. four cylinders just rev higher in general.....