GT engines are considerably cheaper... especially than a new Cobra engine. But I like the way you think.
Here's a good 281 motor.The F20C from a S2000 would be ideal, as it's light and very powerful. They're just hard to find and quite spendy. My best bet would be to find a wrecked S2K, pull the motor and ditch the car. We'll see. I think my friend and I are serious about this.
Here's a good deal on a project MGB GT. 
