Hi Hans: I fly behind a 1955 O-320 150 hp from an Apache. It came to me with about 3200 hours TT and 7/1 pistons, thin wall pins, and 1/2 valve stems (they came initially with 7/16, so watch for this) I flew it from 1986 until 1990, and then rebuilt it with chrome barrels, thick piston pins, o-360 rods, and 8.5/1 pistons. With my old Pacesetter 200, it turns up to 2850 at 8500, so extending the hp curve in the manual from 2700 to 2850, it is making 170-175 hp
Confession: I did not install longer studs and did not use "B" cylinders with base plates. My rationale is that the engine see 160 hp for a pretty short period of time-sea level take off till the first power reduction or the altitude at which it makes 150 hp (around 3000) Part of that rationale is that I get to 500 feet pretty quickly, and can make a 210/30 turn back if one of the cylinders pop off.
I am told it is a common SuperCub/Pacer uncertified mod and no problem. I have about 700-800 hours on my set up with no trouble, and operate from a field elevation of 125 feet.
A 3 with a 160 engine will be fun. Back in the day, Jim Ewing had a Rocket 1 which was a 3 with an angle valve o-360 pumped by Lycon....I recall a Bakersfield Bunch lunch in the late 80s, and he pitched up to pretty close to vertical and climbed like a homesick angel...John N95JF