If you're starting from scratch for an engine, an LS3 will be a better buy, both in terms of potential, parts used, and overall cost, over the LS7. (atleast based on everything I determined from my research)
If you're a crazy SOB like me, you can look into a sleeved, built LS2 - 800hp; 6000RPM (so no silly needing to wind it up to 8000RPM to make it). I don't think (but don't quote me on this) they make sleeves for LS3s, and it's just silly to sleeve an LS7 (in terms of cost) unless you have it sitting right there in front of you (as you'll end up at the same place as the LS2, except $3-4k poorer)
In terms of the car, it's a great piece of art. Based on your post, here's my comments, take them for what they're worth, and remember that I'm VERY UNskilled in terms of automotives. It takes me 6hrs to chagne the brake pads on my Z06, on a 4post lift even, and if I don't strip the drain plug when changing my oil I'm estatic! The things some of the other member on here can do, mechanically, is insane, so I'm the ........... special .......... person in the group, haha.
If I hadn't built my FFR 65 cobra before this, there's no way I'd have been able to do this project - it's not impossible by any stretch of the imagination, but it does require some skill and foresight that you gain from having done a project like this before. Basically you need atleast 2 of the 3 - skill, time, money. I lack skill, but I can afford to throw oodles of money at it and spend 8hrs a day working on it (I've spent roughly 600hrs with it already, between the hard (doing) aspects and the soft (thinking/researching) aspects) and enjoying it, so I'll get 'er done. ... and again, remember, this is from the perspective of somebody with virtually no automotive talent; ymmv.
These (component cars) arn't the type of vehicles you (atleast I) don't want to drive everyday - they're raw, brutal, fast as get out and relatively unsafe, but oooooooh so much fun. But still, they're very physically and mentally draining to drive. Fun, yes, but not something I'd want to drive several days a week. These types of cars make my Viper seem like a great daily driver. ...With my cobra (640hp; 2120lbs; straight through exhaust), once a week is more than enough to enjoy it, anymore becomes tedious.
And reliability depends solely on your build skill and the parts you use. Fran has a solid chassis, but it's up to you to make certain you don't kill yourself. With an OEM car, it's unlikely that you'll find your drive axle thingie can flying out infront of you while you're driving; here, if you forget to torque one side to 118ft-lbs+double nut +blue loctite, well, enjoy seeing it ahead of you, and you've got noone but yourself to blame

And even if you're super duper anal and triple check everything, you'll find a lot of surprises along the way. For example, in the first 1400miles on my cobra I replaced my racing radiator 3 times - and each time it had absolutely nothing to do with anything I did (manufacturer defect); heck, I went through 12 starters before I got a working one!
So, in conclusion, it's not a hobby (due to time and $$$) to take lightly, but it is well worth it if you have the interest.
And, of course, ultima bad. Factory Five baaaad. RCR gooooood :thumbsup: