do i really need 3" exhaust

I can tell you from the racers perspective....I have a small street roller in my 410 stroker (248/254), ported Edelbrocks, pump gas friendly compression (10.8:1), 750dp, and I run 3" exhaust that exits just before the rear tire. I had Flowmasters on there for the past 14 years, but they recently rusted out so I'm in the process of fabbing up some Dynomax Race Bullets to take the place of the Flowmasters.

My car DOES go faster when I remove the exhaust. I can't see using a 2.5" exhaust on a healthy stoker motor, it would choke out a fair amount of power for sure....not sure how much though. If you don't race though, then you probably won't care.

FWIW, my stroker is probably a little north of 550hp and runs mid 10's in the 1/4.