VW's respond well to traditional hop up techniques. Dual carbs, distributor change, and a header make a nice difference in them, and don't break the bank. Beyond that you start tearing into the motor for a cam, some better heads, and more cubes.

My Son had a mild 1915 with dual carbs, cam, head work, header, and an 049 distributor, and it would haul. If you are going to go with a new engine it really isn't all that much more to go bigger, but as you move up in cubes you start running into more heat issues sometimes.

Don