TL/DR: for daily driving, buy an '85-'87 V6 with either transmission. For autox, forget it...buy a Miata or MR2.
Long version:
Hey - a topic I know something about. I used Fieros as daily drivers from 1992-2001 (an '84 4-sp, an '86 SE V6/4-sp, and an '88 4-cyl/5-sp). My mother-in-law has an '86 SE/auto.
The automatics weren't bad. It was the THM125 3-sp with lockup torque converter. Very reliable and a good match for the V6. The 4-cyl/auto was postal-Jeep slow. If she wants a 4-cyl, you want the '85-'88 with the Isuzu 5-sp stick - a much less clumsy shift linkage than the Muncie 4-sp that came on the '84s.
The 4-cyl uses timing gears rather than a chain, and one of the gears is nylon and tends to strip around 150K miles.
Fire risk is vastly overstated. About 400 of the 1984 cars burned up. Later models didn't burn. Come to think of it, avoid the '84 altogether unless you find a smoking deal (joke intended). My '84 had electrical bugs that the '86 and '88 never had - kept blowing fusible links.
The '88 has better suspension and brakes than the '84-'87, but keep in mind they only made about 26K 1988 Fieros. Parts are still available...but for how long? By contrast, parts for the '84-'87 are plentiful and probably will be for a long time.
The stock '84-'87 brakes suck compared with any modern car. 9.7" non-vented rotors, front and rear.
Fieros are surprisingly easy to wrench on. It's standard FWD GM stuff in a fairly wide engine bay.
Fieros don't have power steering, so parallel parking requires a little upper-body strength. (My 105-lb M-I-L can do it, but she's a feisty Italian woman of "a certain age." YMMV.)
Fieros have more luggage space than a Miata or MR2 - a deep rear trunk, a small front trunk, and room behind each seat for small soft bags (unless you're tall). My wife and I took a Route 66 vacation in a Fiero. No way all her crap would have fit in my Miata.
Everyone wants a fastback ('86-'88 GT), but under the skin, they're the same as the SE ('85-87) or Formula ('88). An equivalent notchback is usually ~25% cheaper than a fastback.
Fieros are clumsy on an autox course, but better at speed. I did a track day at Mid-Ohio in the '84.
I have seen the following engines swapped into Fieros: 3.1 V6, 3400, 3400 Twin Cam, Northstar V8, Cadillac 4.9, SBC, LS.
(Bubba voice) That..that's about it.