Dont think you will be happy with the 8v for long no matter what you spend on it.
I suggest you save your money up and buy a car with performance that will make you happy out of the box.
Mk3's will munch your money in the quest for speed and handling, you have to like them a lot 
Stand by my reply some posts ago.
If your going down the engine swap route you have to go 1.8t for bang for your buck, or for a 3.2 VR if you have dosh.
The 16v is only slightly less underwhelming than the 8v and will cost a lot of money to add decent bhp let alone the hassle with Vosa and your insurance.
Just go out and buy a Mk3 16v for under £500....or something with a turbo already installed
