Doug;
Unless you plan on doing some serouis racing, I think you would be just fine with a 350 hp. or so crate motor for the price........and even if you plan to race "a little", 350 hp will do a lot more than you would think............
Having a 'rebuildable core" is not always the least expensive way to go as you have found out........depending on the age and condition of the core, a lot of high dollar machine work may be needed!!!!!!!!!!!!!
Just for the heck of it, I pulled up Keith Craft's site here, he offers a 306 cu.in/375 hp/375 torque, complete with carb/
oil pan/distibutor/flywheel, pretty much everything ready to install for approx. $5,500.00..............I'm sure there are other vendors that do similar engines, I'd check them out if I were you...................
David