Matt -

Dig thru the Brickboard archives, and also find the abridged on-line version of the Volvo Performance Handbook for a few cheapie mods which all help performance.

If you go to the K&N cone filter you will be sucking in only underhood air, which at least here in New England means pretty warm air about 6 months of the year. I would disconnect the hot air pipe from the exhaust manifold 'stove' and then use the filter that goes in the stock air box.

I recently installed a VX cam from IPD, along with the adjustable cam gear. I'm looking for mid-range torque, not screamin' revs, so the adjustable cam gear allowed me to dial in 5 degrees of advance. My 0-60 times are about 1 second quicker than with the stock cam, and most of the improvement is in the 2500-4000 rpm range. I had the chance to do some extended highway driving this past weekend, and the added performance in 4th and 5th gears at highway speeds is exactly what I was looking for. It seems like the throttle is barely cracked at 60 mph. Fuel economy so far is unchanged. I had the car up to 95 on an open interstate, and even though I was in 5th it felt like the car had a fair amount of poop left. My old, unmodified 245 felt positively out of breath in 5th at anything much over 85 or so.

Mind you, moving from completely stock to a mild cam does not turn a 2.3 liter engine into a fire-breathing torque monster. But the impoved throttle response is noticeable, and accelerating onto highway on-ramps is really more fun now.

Since my aft muffler fell off a week after installing the cam, I just bit the bullet and sprang for IPD's high-flow muffler. It's the Turbo muffler and larger-diameter pipes up to the cat, eliminating the forward muffler. You could buy the same Turbo exhaust from Foreign Car Parts of Groton for about $100, then have your local muffler shop make a transition piece and new hanger to get from the cat to the axle pipe. I hope to install mine this weekend.

As always, make sure all the basics are up to snuff FIRST - fuel, ignition, etc.

Good luck!