500 dollars wouldn't be all that it needs, but that turbo is certainly capable. I worked with DSMs for about 10 years before parting the car out two years ago. A number of pics of my old car/setup can be seen here:
Index of /pictures/Misc Pics
Basically you have two flavors of traditional 4g63 engines, a 6bolt and a 7bolt. The bolt number refers to the amount of bolts located on the crankshaft where the flywheel connects. 7bolts had a notorious crankwalk issue that happens from time to time, but technically the block itself is more stout. In factory form these engines handle 400awhp with ease, with the highest I've seen being 610awhp from a complete stock longblock minus head studs. The transmission should be more than up to the task at those power levels in such a lightweight 2wd application. You would want a clutch upgrade, but you would be dealing with a 300 dollar new ACT 2100/2600 style clutch. The 1995-1999 cylinder head is the ideal head for direct flow to the intake valves, and provides the best across the board power. In factory form the engines can rev to 8k fairly consistantly with a factory redline of 7k. The fuel injectors are 440cc from the factory, so they would need to be upgraded, but at 400whp you are looking at very cheap injectors, likely on the order of 150 bucks for set. DSMlink is a great option to keep a factory-like idle and startup conditions while still offering speed density tuning with datalogging. DSMlink is simply a chipped factory ECU that allows programming by the end user and runs all of 500 bucks.
Stock head
Stock block
ARP standard headstuds
Stock exhaust manifold
Stock intake manifold
650cc injectors
DSMlink
ACT 2600 clutch
Evo 3 16g turbo
That would be what I would consider all that is needed to run 400whp. This is assuming that you would already be running a custom intake, intercooler, and exhaust setup since this is a kit car. Most of those parts I listed are stock, and you can likely get away for a while without most of those and keep it even cheaper.
Im glad to hear he's planning to run an AWD trans as they are stronger. There are companies out there that offer the fwd trans adaptation, but basically it requires welding the center diff, and blocking off the output shaft to the transfer case. Transmissions for these cars are fairly cheap and should have zero problem holding this kind of power. For those of you who don't mind running an auto trans, the DSM auto trans holds legendary amounts of power and is capable of damn near 9 second time slips on a DSM in almost factory form. In a car like this I would imagine it would be unbreakable and the car would scream out of the hole with the smaller turbos it would be forced to run.
What's the estimated weight of the end product? 2000lbs? I've been watching the FFR 818 but this car catches my eye heavily.