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I've seen some really nice body work done on 850's, most of the better kits consisted of ground effects, lower airdamn, side skirts, rear valence. This kind of thing looks really nice on a car with dropped springs and wider, lower profile wheels and tires. I would stay away from a custom hood, I don't think it would look good with the 850's lines, and please, oh god please, do not put one of those ridiculus rear wings on the back of the car. I swear, kids today will put a 6 foot high wing on anything. I just saw one the other day on a completley clapped out, basket case dodge stratus. If you spent a buck fifty on that wing, why not take the same money and do something like, oh I don't know, get the car running right! As someone else said, if you take the time to do the body, then get some decent paint on the car. Unpainted plastic doesn't really look good. I know good paintwork is expensive, but there's no subsitute.
As for putting in a turbo, like the other people said, sell it and buy a factory turbo car if that's what you want. You'll get better performance and the motor will live much longer. The turbo 850's had completely different engine internals that the N/A cars. Sodium filled valves, forged rods, etc.. You could probably get a turbo setup that would work, but you won't get much lifespan out of that drivetrain.
I have a 1993, N/A car, and for my uses it's fine. Next year it's my turn for something new and more performance oriented, so I'll be getting, most likely, the '05 Subaru Legacy GT turbo. But if I wanted to stay with a Volvo and wanted performance and couldn't afford something new, I'd be looking for a T-5. Prices on those cars are pretty reasonable, you could probably sell what you have now (if it's in good shape) and get a decent chunk of what you would need for the T-5.
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