I think what it comes down to with the gen3 versus gen2 debate is that the gen2 "can" run fast times with little mods, but the gen3 "does" run fast with little mods. The point of the gen3 is the head start you get right out of the box. No matter what you do to a gen2, it will not/cannot be a gen3 unless you literally swap the head. Sure some people run damn fast times with a gen2, but the fastest mr2 and celicas in existance are gen3's. The highest hp mr2 in the world is a gen3. There are reasons that the Hux's, Talent, and Mike Colon went with a gen3.
Read through the list of differences I posted between the gen2 and gen3. We're not just talking bolt-ons here. Think about what it would cost to change your intake and exhaust manifold, and turbo...then add injectors, and some kind of aftermarket ECU to control it, and hours on the dyno and you have a LOT more $ invested than what a gen3 would cost you. Don't get me wrong, the gen2 rocks, and is a great platform, but after years of research, I have concluded that the gen3 is a bargain for the performance it brings...but that is just my opinion so to quote a great philosopher, "to each his own."