318 vs 340 Questions

Running 318 has the advantage over rebuilding anything else.
Cam, headers and 4bbl on the 318 can get you close to 300 hp without tearing into the long block after that something like EQ's get you another 30 plus hp.

When it comes to short block biggest bore allows the most air flow there for the most hp so 340-4.04",360- 4",318-3.91 largest to smallest. When it comes to engine size the biggest engine in cubic inch will makes the most hp per rpm but the bigger bore can out rpm the smaller bores eclipsing the difference. Part 2 of this equation is gearing the bigger the engine less gear needed to equal the performance of the smaller engine (generally equal to the percentage of cid difference so a 3.23-418 would basically equal a 4.30-318 ). The best short block would be 340 block with the 3.58" plus stroke which would give you the most breathing and cid. Above 3.58" stroke you start compromising bore stroke and rod ratios if you care about such things but a 4" stroke requires a lot less rpm and gear which has its advantage on a street engine.

So if you dont mind running deeper gears build the 340' with the 3.31" stock stroke or 360's 3.58" stroke. If not drop a 4" stroke into it and if you want to save a bit of money start with a 360 block and sale yours but to me that doesn't make much sense since you already have it.

Depending what you are starting with I'd build a good foundation brake, suspension and good tires then gears and exhaust. Then cam, 4bbl like comp xe262h and performer with 650. While building the engine of your choice 340/360/408/416 etc.. you can sale the running semi build 318 before the swap.