[84LX89GT]

The turbonator is a gimmick, it's more of an intake restriction than anything else. Every vehicle has built into the design sufficient intake swirl/turbulance and tumble and then to top it off with closed chamber heads (like 3.8L) there's the squish/quench area of the cylinder head - in other words it's excess. In the mid 80's early 90's ford designed the Ford Tempo with a 2.3L HSC engine (High Swirl Combustion) what they found was through having a cylinder head designed for high swirl it would actually swirl the air/fuel too much causing fuel to seperate from the air and sticking to the cylinder walls and causing a lack of power/gas mileage especially at higher rpm. the HSC engine didn't get any better mileage or power than any other 2.3L engine.

As for performance, how in depth are you talking? You can buy flow balanced/ported heads that make a huge power increase, ported intakes, Split port conversion kits ('99+ style 3.8L engines had something like 50 more horsepower). light duty (F-150) trucks had 4.2L engines (stroked 3.8L).

To start off, if i was your buddy i would buy a '99 mustang since they have 50 more horsepower to start with and aren't that much more expensive. But, for my money (best bang for the buck) these are the things that i would do in order:
1. Install a rear sway bar. I'm not sure if the '94 up V6's have sway bars or not (i forget) but if it doesn't it is one of the single best improvements you can make to handling/braking and acceleration because it helps plant both rear tires.
2. 3.73:1 or 4.10:1 gears with a limited slip differential/locker. 3.8L mustangs came with a 7.5" rear axle instead of the GT's 8.8" rear axle. If he doesn't have money for limited slip/locker even just the gears would make a HUGE difference in acceleration although traction becomes a problem with the increased torque multiplication.
3. cold air intake kit that has the filter located in the fenderwell, or at the very least take the intake silencer off the air cleaner housing (unbolt and remove filter housing and take off the rubber piece that necks down inside the fenderwell)
4. convert to dual exhaust. There are kits that include hangers and allow you to either use stock GT exhaust or you can buy a full dual exhaust kit for a V6. For loud/raspy you can get flowmaster 2 chamber or for deeper tone MAC, but there's a ton of choices out there. If you get a V6 h-pipe i believe it will allow you to mount any GT cat-back exhaust system you want to it.
5. Nitrous Oxide - cheap, easy to use and for a very small investment 50-150 horsepower at the touch of a button. Unfortunately the bottle eventually goes empty and 3.8's aren't known for their ability to seal high cylinder pressure.

--To be completely honest, '94-'98 V6 mustangs are 17 second cars and are notorious for blowing head gaskets. The '99+ V6's seemed to have had fixed the head gasket problem and make 50 more horsepower. If he does buy the car his money would be better spent on suspension/wheels tires and making it look nice because there aren't many real sports cars a V6 mustang is going to keep up with without some serious $$$ invested.

Good luck with your friend's stang, i hope some of this helped.