If you're going to gift the car to your navigator then keep the 1500 engine, especially as you wouldn't leave the Fiat engine in. Just do the head mods, cam, oil cooler and get it rolling road tuned. Keeps it simple and easy. Not as quick as the twin cam but much less complicated.
I used to race a Jag Mk2, never won a race but as Mathew says I still had loads of fun and anguish, fear and empty pockets!
Iain