If memory serves me right, and I would also verify on the nasioc and rs25 site, the 2.2 is not the most mod friendly motor. but there are a few things that can be done. Again gains are not that great, but there gains none the less..
Along with a free flowing exhaust and intake, most guys do cams, usually from delta. Along with that piggy back ecu from rallitek. There may be a throttle body spacer but can't remember correctly. If you find a 2.2 you can do what I had planned and that is take the 2.2. heads, mild port them, and attach them to a 2.5 phase II block and create a hybrid setup. This setup is a slightly higher compression setup than the regular 2.5 DOCH or SOHC. Do the same upgrades as above, with comet (can't remember the company name) or I think its an OEM STI gasket and have fun.. Plenty of threads at rs25 on this hybrid topic. SHould be a solid 180-190 HP.
Also SOHC motors are a lot easier to fit into the bug vs the DOHC monsters..
Lastly you will need to consider a few things... (could not help the plug) a new or modified low profile oil pan, and an exhaust manifold. Both of which Bug@5speed can help you with.
Now if you get your hands on a legacy 2.2t for that price
, then you will be quite ahead of the game as that block has a lot of forged items and is a closed deck design.
Dave, do you have pics of your vert, I have one sitting for now a 78 SB, that I am always looking for ideas.
VR
Alex