Why not just use a CDI Mercedes engine, import a manual transmission. It would be light and suited for a manual. 3.0-litre turbocharged diesel engine that produces 265 bhp and 457 lb /ft of torque stock, I am sure you could hop it up. 0-60 in six seconds, which is super fast for a diesel. Or go with s 3.0 TDI.
for a c4 vette i'd consider a 4bt. short enough to fit about where the sbc was and probably able to keep the radiator atleast close to in place. height might be a problem but with a modified pan you can probably get it to easily fit with a cowl hood. and being a fully mechanical engine throw some valve springs in it, 4k gov. spring, a bigger turbo, then just crank boost and fuel and adjust timing and it could be a pretty fun ride