My father and I have two turbo Mustangs. My father's has a single T-76 and mine has twin T-66 turbos. I have spent the last three years building and tuning the two cars. After all the research, trial and error, and finally success, I have learned a thing or two about turbos.
In general, I agree with all Nic's comments (at the start of this thread) except two: the heat problem, and ease of install. Additionally, I would like to address the question of spool-up time.
Heat Problem: Heat really is a "problem" to be dealt with in a turbocharger install. However, if properly managed, it will not be a problem. The challenge is the exhaust ducting involved with a turbo install. Most designs have the headers facing forward to the front of the engine. Then, after going through the turbo(s), the exhaust must make its way back past the engine again to go out the back of the car. Now you have a bunch of exhaust tubing in your engine bay. The heat from the exhaust tubing will melt wires and burn plug wires if it is not properly shielded. However, with proper shielding, the problem is solved. The methods used to shield the exhaust are 1) coat the headers and exhaust with a high-temp reflective coating, like Jet-Hot 2) Wrap the headers (will greatly reduce header life, especially with uncoated &/or mild-steel headers, because of thermal fatigue... stainless headers are preferred for turbos) 3) Build a heat shield out of aluminum or other sheet metal to cover the headers, turbine housing, or other sensitive areas (with wiring, fuel lines, etc.) 4) Wrap the plug wires with high-temp "boots" or "fire-sleeve", and route the plug wires (and other wires) away from the exhaust. 5) Use a raised-cowl hood to help the hot under-hood air escape. Using these techniques will solve the heat "problem".
Ease of Install: In general, a turbo system is much harder to install than a supercharger system. There is all the exhaust tubing mentioned above, plus the wastegate tubing (if using an external gate). If you are running a single turbo, you have to deal with a crossover pipe (I prefer designs that have the crossover running in front of the engine to avoid crossover/transmission/ground clearance problems). Next, you route the intake plumbing through an intercooler up to the intake. If you are using twin turbos, you have to join the two outputs before the intercooler. This all adds up to a lot of tubing, and like all car parts, NOTHING FITS. Plan on a lot of "tweaking" to get everything to fit right. When you compare that to a simple centrifugal blower install w/o an intercooler... the blower is much easier to install.
Spool up time: Spool up time is affected by several factors: 1) Manual transmission or automatic with high speed stall? 2) Size (mass) of compressor(s)? 3) Engine compression ratio? 4) Turbine exhaust housing A/R ratio? 5) Camshaft design? 6) Exhaust back-pressure?
1) In any car with a manual transmission or an automatic with low stall, the engine is not able to freely rev up to its power band like a auto
trans with a loose converter. You want quick spooling? Put in an auto with a loose converter (same goes for centrifugal S.C.)
2) Centrifugal compressors (superchargers and turbos) typically run at speeds between 50k and 120k RPM max(smaller compressors run at higher RPMs). The mass of the compressor determines the force required to accelerate the compressor. Two small compressor wheels can move the same air as one big compressor wheel, while weighing less than half, so they spool quicker... hence twin turbos advantage. Don't expect the exhaust energy from a stock engine to quickly spool up a 101mm turbo.
3) Compression ratio can make a big difference in the amount of exhaust energy available to drive a turbo. Ever hear the "crackle" of a high-compression race engine? Those intense pulses from the high-compression exhaust port have much more force than the those from a low compression engine. However, the high-compression engine can not accept much boost. A low compression race engine gives up some low-RPM exhaust energy to be able to accept large amounts of boost to make high horsepower levels after the turbo spools up. Many people are astounded by how much power the turbo Buick V6 makes. Guess what... many are running 7:1 compression and 20+ pounds of boost. A street car should be somewhere in between.
4) The turbo exhaust housing A/R ratio is basically the "size" of the housing. The larger the number, the bigger the housing. The housing is the "funnel" the exhaust passes through to spin the turbo. A small housing (big exhaust restriction) will build a lot of backpressure in the headers quickly, providing a lot of force to spool the turbo quickly. However, the same exhaust restriction kills performance on the top end. The opposite is true for a large exhaust housing (large A/R ratio).
5) Camshaft design plays a big role in spool-up time of a turbo motor. A turbo camshaft should have little or no overlap. Why? Exhaust pressure in a turbo motor (in the headers, before the turbo) is typically two to three times the boost pressure, depending on A/R ratio, etc. What would happen if you have 15 psi boost, 30 psi exhaust pressure, and the intake and exhaust valves are both open? The exhaust will blow back into the cylinder/intake. Additionally, the RPM range the camshaft is designed for will have a large effect on exhaust energy. If the cam is for high RPM (lots of duration, some overlap probably unavoidable) then it will be inefficient at filling the cylinders at low RPM and generate little exhaust energy until RPM increases to it's designed efficient range. A stock type cam (especially combined with similarly tuned long runner intakes) produces an efficient low-RPM powerbamd, and will develop exhaust energy quickly.
6) Exhaust back pressure can make a significant difference in how fast a turbo spools up. The force available to spool the turbo is directly related to (Pressure inside headers) - (exhaust backpressure after turbo). Many turbo race cars have found that dumping the exhaust directly out of the turbo (without going through a muffler system) can reduce spool up time and increase boost pressure. A turbo engine generates just as much exhaust gas as any other engine with the same horsepower. Make sure that your exhaust does not create a restriction for your horsepower level, or the turbo spool up time will suffer. Also, 20 feet of 3" pipe is significantly harder to blow through than a short turndown of 3" pipe. Try this experiment: Breathe through a McDonald's soda straw, then cut it to 1" long and breathe through it again... a huge difference.
All in all, turbos represent the most powerful, reliable, and streetable power adder. Their shortcomings are cost and install complexity (cost). Check out the JunkYard Turbo group for cheap alternatives.
http://groups.yahoo.com/group/jyturbo/
Here's someone who did it cheap and well:
http://www.toohighpsi.com/DragRadial/dragradial.htm
Here are some more good turbo links:
http://www.turbomustangs.com/turbo_links.htm
If you can afford one, install one (or two) properly and you will not be disappointed.
-DanTheMan-
dshipley@cncnc.com
Turbo vs. Supercharger 
