Ask yourself what sort of car you want - interesting, fairly exciting everyday driver or a race car that you also happen to drive on the road. You need to build the car (and the engine and transmission) with your expectation of use firmly in mind.
As you probably know, I once built and ran a small block Chevy engined 240Z. I built it for road use, knowing I would occasionally drag race it. It was a usable road car up to a point, did acceptably well in the sort of road rallies the Z Club was allowed to run in the dark ages and gave a lot of enjoyment. But, to make it a successful drag racer meant installing a less road-friendly rear axle, stepping up on cam profile, running NoS etc. It was capable of running 10.4 second quarters, but you wouldn't take it shopping (often) or drive to the race track without ear plugs and a cushion or two (I exaggerate really, but the point is, build to your desire).
You can have 300bhp or more from a Z engine and drive it on the road, but I wouldn't guarantee that you would enjoy it for everyday use. The SBC is a great compromise due to the huge application of V8 torque for which you can forgive almost anything, but the exercise will not be without heartache.
And just because a Z32 owner claims 600bhp, don't believe it until you have seen it proven in a real world application. The drag strip is the world's cheapest rolling road - it measures real-world performance (including the driver) and is a great leveller. It is unforgiving of bulls**t.