Speaking from experience, the big block will be the most cost effective for what you want. You will not have to put a whole lot of money into the BB just to get 600hp.
The one thing that I will add is that using a manual
trans would be fun to drive but if you are thinking just strickly racing, then you would more than likely want to go automatic just because in a high torque car and you miss a gear, who know's what will happen!!
In picking your
trans if you go auto, do not use a C4, yes they are small and light weight, but no matter how much money you spend beefing up that
trans, they are still weak. C6's are too heavy and require ALOT of HP to turn it. Put a chevy turbo 400 in there or go with a chevy powerglide. They make adapter plates to bolt these
trans right in.
Fitting a BB with a chevy
trans slips right in. You will not have to/ should not have to beat any sheet metal to get it to fit into the car.
I'm running in 10's right now without what I consider any major mods on the motor naturally aspirated. I know that I could be in the high nines with some more tunning.
Which ever way you decide to go, please don't forget about beefing up the rear in too!! Not just a gear change make sure your axles are beefier and use C-clip eliminators to avoid disasters.