Anything above 400 HP, a G body (even a low mile rust free one) is going to need frame and body reinforcing so it doesn't twist apart. If your car has any rust problems like rusted out frame or body mounts you will need to fix such issues first.
What you say about rust is true, however 400hp is a walking the the park with a g-body. Remember kids, it's torque that will twist your frame. That said, I run 11.67 @ 119.6 right now and I'm on a stock non-reinforced frame. And I have t-tops. No twist here and I launch flat and level. Granted, I do have all aftermarket tubular suspension parts, a giant drag swaybar, oh...and I did tie the upper shock mounts together. I do need to replace the rotten body bushings, but that's for a different reason entirely.
While the LS has its pros, it also has its cons like every engine does. The LS oiling system isn't as good as the SBC's, it is why LS7s and 9s use a dry sump setup because it is a retrofit bandaid. The shallow oil pans and deep skirt blocks are bad for oil control and the oil pump being crank driven increases cavitation. The deep skirt block also is bad for crankcase ventilation and why LS motors have PCV issues.
A lot of what you say isn't correct concerning the LS motor. Early (like pre '99) engines had crankcase breathing issues from web to web because there was no opening between the webs for anything to go anywhere. This was fixed. Dry-sump was added to Corvette ZO6 (LS7) and ZR-1 (LS9) as well as Camaro Z28 for both packing reasons and because they are road-race inspired/purposed. This is pretty standard for any engine pulling heavy and sustained lateral g-forces. Stock wet-sump oil pans are better than SBC/BBC oil pans and pumps. They are not shallow except for the odd Corvette pans that exist only because of packaging reasons. Those suck. The deep skirt block is NOT any reason for the PCV issue, that's completely unrelated. The PCV sucks in heavy oil vapor because of the aeration in the valvecovers. The PCV was moved to the valley cover in later engines and the problem was largely solved, but there's still plenty of oil vapor to separate before letting the intake suck it back in. So, we run an inexpensive catch-can...problem solved.
Another issue is that tuning LS motors is very expensive. The tuning software starts at $700 and is another $100 for every additional car you want to tune with it. Also you need to know how to read and use 3D curve mapping and may need to take courses for it. That is why many opt to go to a tuner shop instead who usually charges at least $250 a tuning session and it may take more than one to get things right.
Interesting that you focus on only the tuning cost..and you have come of your prices a bit off. It's $650 for the HP Tuners Pro and you can tune 4 cars (8 credits) with it. Only $50 more for each additional car past that. But, you're forgetting the cost of a wide-band o2 sensor which, IMHO is a MUST for tuning and they run about $150. You can tune by LTFT and STFT, but you really shouldn't. Independent dyno tuners likely won't touch your car for less than $500, but fly-by-night guys will do it on the street for $100. But, you get a factory EFI system that is very complex, has individual coil per plug, etc. How much does it cost to put EFI on a SBC?
Because G bodies were never designed for LS motors, installing one can be expensive and there are some legal issues if you live in a strict emissions area. Stock LS motors use a enhanced EVAP system that is not compatible with factory G body gas tanks. People have had their LS swapped cars failed over this and heard of at least one guy who was forced to go with a Erod crate kit to replace his used LS swap. The Erod versions of the LS motors do not come with an enhanced EVAP, just a plain EVAP making them compatible and legal for G bodies. Also reflashing a PCM is considered emissions tampering and illegal. Some areas do check the PCM to see if it has ever been reflashed. Whenyou install a OBD2 motor into your preOBD2 car it is now considered a OBD2 car and must meet all the regs for it, such as installing a OBD2 ALDL port and SES light on your dash for the inspectors. Even a Erod kit can be redered illegal if its PCM is reflashed. Not sure if deleting VATS is considered tampering by the govt, hopefully not.
Physically installing the LS in my g-body was actually pretty cheap. Used headers from a 4th-gen f-body modified to fit $100. Tubular crossmember for the 4L80E $135 shipped. Adapter plates $45....and...that's it. Stock radiator and Silverado upper hose and Ford E350(upper) for the lower hose. Couple more normal knicky-knack things like the throttle cable and integrating the steam vent, done deal. Sorry if you live in an emissions state. That sucks for you. BTW, my car meets all emissions checks in my state (no visual), just OBD2 ALDL and SES check. It wouldn't pass a sniffer though, no cats, but we don't have that to worry about here.
Aluminum LS blocks use thin nonremoveable iron cylinder sleeves that are cast into the block which limits overbore to just .010. The LS7 and I think the LS9 use pressed in sleeves that can be pressed out and replaced like most sleeved engines. Iron LS blocks are sleeveless direct bores like the classic gen blocks.
LS blocks can have their stock sleeves bored-out and replaced, and many do. It's a common way for LS2 4" bores to become 4.125" bores since the LS2 block is considerably cheaper than an LS7 block. For a simple rebuild though, if .010 doesn't do it, it's cheaper to just source a fresh block! Yes, the LS7 and LS9 use pressed sleeves and both blocks are not very cheap. And sure, the iron blocks are direct bores just like the classic SBC...but they are iron.