318 to 360 swap with a 904

I am really torn. I would like to build a car that is really fun and still streetable, even if marginally, for around town. I have a C5 Z06 Vette that is a fair weather car that runs 11.60s at 128 with a 2.02 60' with a/c and full stereo etc. so a 14 or high 13 sec car is not really what I want to build. On the other hand a 318 with close to 400hp plus a 100 shot of spray with the better traction of the Duster sounds really fun. My nephew who I am building the car with wants to stay with the 318 to surprise people. I am still debating since we are still working on the body, suspension etc.