Yeah, I live in FL and am a half time college student (Mechanical Engineering), so money is tight. Be that as it may, I still wound up doing some research today as it was my day off. Research for me is a trip to the junkyard, tape measure and a sheet of paper in hand to determine what will physically fit-and what is available. My DOHC V8 idea washed out due to space restrictions, but I did find 4 HO 302's that could be mine for under $300 with everything ( wiring, ECU, accessories, etc). I also found a South African company that makes an adapter to mate the BMW transmission with the Ford Windsor V8. ( I really want to do a E30 BMW!) I also found 2 BMW 325's for sale on Craigslist for $600 obo for the pair ....if only I had the space and a little spare cash I would at least buy that. The 302 in Fox platform dress, is only around 100-120lbs more than the BMW M20 L6 it would replace, and the weight would be around 4-6 inches further rearwards in the chassis than the L6 is, thus off setting some of the additional weight. There are also cheap brake upgrades for this chassis using pieces from the later E36 chassis 3 series and Z3, and the differential from a 5 series will also interchange ( from what I have read). The nice thing about BMW's is that no one really knows anything about them. Very few are hot rodded in any real way, so the parts go largely un-pulled at the U pull it yards around here. Plus, the 325es, 325is, and 318is all came with factory Recaro seats and 4 wheel discs with optional ABS, leaving 2 things I do not absolutely have to change.
I also found that BMW puts it's VSS in the differential, not the transmission tailshaft. This means I can keep the BMW VSS to run the cruise control and speedo while the Ford VSS can run the ECU ( either EEC IV or Megasquirt) if necessary. This way, BMW controls all of the car's systems not related to engine management and the engine's spark and fuel can be run independently. This gives me the ability to easily keep the A/C, cruise control and gauges without having to change much. All I have to do is adapt the systems to work together (Ford compressor clutch wired to BMW Controls, hybrid hoses for fuel, A/C, P/S, Ford TPS sending signal to BMW ECU for cruise, etc) I kind of proved feasibility today--now I need to have the time, money, and space to actually try it.
The biggest negatives with a G body for auto-x are weight, size and weight distribution. The live axle does not help matters either when it comes to transient handling. Unfortunately, the G body with a V8 has a 60/40 weight distribution ( The BMW E30 is 53/47 and the s13 240sx is 50/50 for comparison), and that requires 350lbs be shifted to get it to the optimal 50/50 ( most G body V8 cars weigh around 3500lbs unless you gut them). It can be done, and I am one of the guys who sets their cars up more for handling than drag racing. Mine handles pretty well for what it is, but would be seriously out classed on an auto-x by something like a properly set up EG Civic or a Mazdaspeed Miata. You need some pretty serious tires to overcome all of the weight of the G body if you are going to race against a lighter, smaller car. Yeah, most newer cars are over weight, but most can overcome that with removal of airbags and related SRS equipment along with extra sound deadener, etc. A g body is not that simple to loose weight with as it does not have the same amount of unnecessary equipment from the factory as newer cars do.