FI engines usually see a dip in power at the point when the cam(s) switch over to the VTEC lobes, but that can be dealt with on a dyno. The only reason VTEC might be "bad" for for turbo is because it's another parameter that needs to be tuned.

If you're talking about a USDM B18C5, you shouldn't have a problem with emissions or smog legality. If you're talking about a JDM engine, they're technically not smog legal, but you might be able to get away with it if the smog station doesn't check the engine code. I would not bore a B18(81mm) block out to 2.0L(84mm) unless you're getting it resleeved first, because 84mm bore on stock B18 sleeves leaves the cylinder walls pretty thin. I'm not sure why you would want to use B16A pistons, since they're lower c/r than B18C5/B18C-R pistons. Whatever you do, as long as it's tuned well, it shouldn't have a problem passing emissions.