As a race car, 250bhp fwd is enough. But as drag car without the worry of handling and corners, big power will own. Or on a rolling start. Some civic FWD drag cars are insane! Depends how you want to use it. If you threw a 500bhp vr6t in a mk3 and a 250bhp 1.8t and dragged them, the 1.8t would be quicker to 60 but past 100 the vr6t would be gone and keep going to 200mph I'd suspect.
I get really good traction with my standard diff. I have a solid front engine mount, which helps and the longer ratio's. I get traction in the wet in 2nd!