If I decided that, I'd just fit a Z20LET mate, or supercharge a Z22SE, or I'd even consider the new 1.6 turbo (don't even know the engine code!).
I wouldnt mess with the 1.6 16v. I'm moving more towards a 1.8 16v now anyway, as insurance is exactly the same. Sky Insurance have totally smashed my best price... £480 down to £300!! Now thats nice!