As soon as you drop into the demon diff teritory, you've gotta make it rev.
Mighty 6 is on to it. He likes nothing less than 5.1 liters of Chevy grunt churning through the traffic rails!
To run a 3500 rpm stall, and 3.5 or 4.11:1 gears, you'll lose some streetablity but gain a huge amount of start line urge. The C4 is a pearler of a cog-box, cheap and easy to rework. It's all there! But as you get more radical, a 3-speed looses the ablity to cruise. This is because the converter won't hook up untill 80 mph with 3500 rpm stall and 3.2:1 gears, or the car will be screaming at 3400 rpm @ 60 mph with 4.11's isn't my idea of a good time. Get the compromise wrong with a little 200 engine, two gears down on what it needs, and still wanting to kick a v8's butt, is a sour experience.
As for carbs, use anything that can produce power. I think a set of triple IDA or IDF 2-bbl 44 mm Webers with 32 mm chokes, your 272 degree cam, and I gaurantee 250 hp at 6000 rpm with 13.3 second quarters at 6700 rpm in second with the stock 3.2:1 gears. A 2500 rpm stall will load the trans, and the fact that two gears are being used in stead of three if you ran a set of , say, 4.7:1 gears means you'll still be able to cruise at 60 mph with the convertor not slipping to much.
The IDA/F carbs are super expensive, but as long as the fuel system runs pump gas and proper fuel filtration, they are the ultimate in per formance. Even little 1400 cc Minis with a single IDA 48 2-bbl carb and 285 degree cam can trigger the 140 hp mark with just basic work to the heads and exhast. In a 1700 pound Mini, there were sub 14 second quarters on offer.
Your base is sound, the trans and gears are fine, the car is light, and autos are better at drags. The detractors to IDA's and IDF's are the needle and sets, jets and general hassle of tunning them. Read the books on Weber Cards by SA bookes. It covers all aspects of tunning.
The log head is a pain, but with three 2-bbls pulse tunning a finely atomised fuel air mix throughout all the rev range, you'd love it.
Why do you think 289 GT40's ran quad ID Webers? 390 hp from a little 4.7 liter engine, that's why!