I've explored this option and the 2.3L is definitely a nice engine.....I guess its all depends what your after. You would be able to go with some nice gear box options and easily get a Dana 300.
I think one issue arises though from the engine height, if I'm not mistaken. I'm sure a body lift would help the cause. Also since this engine is popular, you have mods available, ie dry sump etc.
The major drawback I found was the weight. The 2.3L has a cast block. Which adds alot over our stock aluminum <=200# 1.6Ls. Good luck in your findings.