Go turbo! Forget the N/A 2.3. You could pour $5k into it and never get over 200hp! 5.0 - have you noticed the price of fuel lately?
You can't just slap a turbo on a N/A 2.3, the pistons won't take it. The most economical and sensible way to do it is to buy a donor car. A turbo coupe would fill the bill but second to that would be an XR4ti. Oh look! Here's one...............
http://phoenix.craigslist.org/car/172680827.html
Just replace the motor in your '88 with the XR's (exact same motor except it's a turbo motor) and your good to go! You can add mods later. Hey, the price is right!