Chuck-
My JPS had his standard 1776 (stock heads, 110 cam, ICTs, doghouse cooler) with the Monza exhaust and heater boxes, and it ran REALLY hot in the summer. Smaller is not always better for heat, and 85 hp is not going to surprise any fart-can ricers off the line. Balanced or not, the carbs, heads, and exhaust are the weak links.
I supplied and installed the engine in the IM, and I was a fanatic about cooling. I've got a 2110 in my car now, and I wanted most of the stuff you are after. I chose 90.5 cylinders because of the reputation for running cooler than 94s. I've got a DTM because of the Type 4 oil cooler, and the better cylinder cooling, and I'm running an EMPI 96 plate remote oil cooler with fan (and fan thermostat, and MOCAL bypass thermostat). I've got a 1-5/8 A1 sidewinder.
Up here, it gets to about 95 and humid every year, and gets over 100 and humid about one year in 5. Last year it was over 90 the entire month of July, and set some records. I don't feel like I over-killed the cooling system at all. If you've got A/C and live in Texas, then you'll want everything I've got.
A standard geared, pro-street transaxle with a 3:88 would be adequate for what you are describing. I did a custom-geared pro-street transaxle because I live where it's totally flat, and 99% of my driving is empty-horizon chasing at 60-80 mph. I've got a .82 fourth with a 3.88 R/P, but perfect for the 2110 would be a .85. Stock is a .89, which would be just fine for almost anybody. With a stock-geared transaxle, first is pretty useless unless you are plowing a field or drag racing, and the 3-4 spread is too close. John Steele is pretty good at selecting gear ratios, and has done one that ends up at about .89/3.88 with much better spreads. I'd talk long and hard about this, no matter which engine you go with.
When I had my JPS built, John was using Serrano engines-- I'm not sure what he's using now, but I think this is still the case. If it is, than the DTM is part of the option list (from Serrano-- check his ads on the Samba), and I'd most strongly recommend it. John may tell you it's overkill-- it's not. I have no idea if JPS will do a remote cooler, but if not-- install one ASAP (do the fan thermostat, and the MOCAL bypass thermostat).
I'm going to be installing a Chico Performance 2387 this winter, with short rods for torque, 10:1 (or so) compression, 48 IDFs, and a 1-3/4" sidewinder (200+ hp, but more importantly: 200 lb/ft of torque at 2500 RPM!). My present (135 hp) set-up will be for sale-- it's been great, but torque is like a drug, and I really want to be able to pull hard on that fourth gear.... >;)