nothin wrong with iron blocks. you'd only need like 7psi 250whp setup to have a fun little car anyways.
spork up in NC did it. i dont think he is turbocharged yet, but i know he had a running KA in his corolla. i do not know much about it, perhaps he ran a megasquirt or something along those lines.
it would at least require custom mounts, perhaps tranny tunnel work depending on the size differences between corolla and 240sx transmissions and how you get it to sit in regards to how far back in the engine bay it sits.
i would think the GT-S rear end is enough, perhaps those who know about Taka's 400+whp AE86 might know what rear end he used.
do plan on alot of fab, wiring, and innovation, and money