The Audi 5 cylinder has been done before, but it is heavy, I thought about a V6 RS4 engine but they can be a little fragile and parts are expensive - spcae for the turbos is very tight as well and it might be too wide - My sisters ex has one and I was intending to measure to see if it would fit between the uprights - His tales of expensive woe put me off - though he still has it, now with over 400BHP and a string of expensive bills!
The LS engine is relatively narrow and compact and with kits available makes sense! Not only that a brand new LS3 with ancillaries and ECU should work out under £7K (plus VAT) with 430BHP and 420Ftlbs, it appeals to be as there should be few reliability issues and it is a nice level of power in a 944.
Tony