Im in the same situation... although, I had the 347 already with the mods in my sig.
I was going to originally boost the 347 with the 10.5:1 compression, but now decided against it becuase if the stock block gives out, i don't want to lose the bottom end. That, and I would only be able to run like what? 4-5 #s of boost.
I decided to buy another 306 shortblock instead and im transfering my h/c/i from my 347 to the 306 and boosting that instead.
DAILY DRIVEN: 92 GT
306,9,5:1,AFR 185s,RPMII,xe264hr,ProMagnum rockers,turbonetics 66S,bg kit,METH,Flowmaster catback,Accufab race 75mm,pro tube,60lb injectors,255lph walbro BAP,ac delete,no smog,full MSD ignition,mark fan,3G alt,TKO600,spec stage 3,alum flywheel,3.55s