I guess the reason they suck stock is that it was hard in the 70s to make an engine that could work crusing at 1500 rpm and also perform well at WOT 7000 rpm. The L28 is very simple, 2 valves, single cam, single plenum intake, very basic computer (or carbs!), simple ignition etc.
Head design is an issue with L28 and high HP. If you compare a stock L28 head to a modern say honda K head they flow very different. Lots and lots of work needs to go into the head to make it it flow enough for >100hp. The intake also sucks so you would have to do something about that as well. Not to mention computer.
Rod/Stroke might be a problem but there are other issues to address first.