It sounds like you are going to be driving this mostly on the street.  If that is correct, I would echo what others have said about the LS1.  I have an LS1 and I am running a much bigger tire than most here with LS1.  I do have a 3.7:1 differential which may make a difference, but I can break the tires loose easily from just about any RPM in first and second without dropping the clutch.  Granted, I have old rubber on there, but right now I am not looking for more power.  I had a 100 shot nitrous kit and 273 heads that I had bought thinking about cam, heads, and nitrous but resold them on eBay because I was fine how it drives currently. 
  
What I am saying is go cheap with LS1 and you can always do a cam/heads/reprogramming later if you are found wanting more.  Now, if you can find as sweet deal on a larger displacement LSx, take it!