From what I have read, and I believe Jake Raby has indicated this, it is best to take the existing engine to build a larger engine and while your at it address known weaknesses and add any other performance related items to get the reliability and performance your looking for. The advantage being you can use all the existing systems without the need, complexity and cost of retrofitting later systems into a older car. I believe the only exception is fitting a 3.4l for a like year Carrera. You might be able to get a 3.6l into 03 - 04. For most of us it's just easier easier/less expensive to buy a Carrera, Boxster S or newer Boxster/Cayman that has more power.
A 3.8l does sound like alot fun in a 986! Forum member rfuerst911sc has gone the path of having his motor built by Jake and hopefully will have it completed soon. Crono0001 has also done something similar with results that he is very happy with (3.8l that gives the car Z06 like acceleration). Maybe one or both can chime in with some words of advice.
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03 Carrera
02 Boxster S Guards Red, black interior with matching hardtop
89 Carrera 4
89 944 S2
78 911SC
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