There's no replacement for displacement
More cubic inches = more HP potential ...everything else being equal. Plus, the extra cubes create more torque.
If you want to go with a 351 based motor, then by all means do so... just research all of the mustang message boards. I haven't anything profound to say about the 306 vs. 351. I have fun with my little 306
It all depends on how much cash you've got in that wallet...