I don't think you'll be able to keep up with the musclecars from even 10-15 years ago, considering how much more advanced the F-body and Ford Mustang chassis' are even for that time. Yes, they are down on power, but even with a built 355 making around 325hp you won't catch them if they've got power adders like headers and exhaust, intake, cam, etc. also- those cars are more balanced and will accelerate as fast, outcorner and brake you, even if you have a slight edge on power. This is why most G1 and G2 Firebird guys go big bore- to get the hp advantage.

Second generation F-bodies can be made to handle very well, but like everything else it takes the right parts (= money) to do it. I upgraded my suspension with 1 3/8" / 1" F/R swaybars, 575 lb. H-O Racing coil springs, '79 WS6 T/A rear leafs and Disc brake rear end, and my '72 has no problem powersliding around these guys on the twisties. And this is on old school rubber- 235/60VR15 Comp T/As on 15 x 8.5 aluminum rims.

You can get a set of 78-'81'T/A sway bars from the boneyard (1 1/4"/ 3/4") for a decent price- bolt these on with some urethane bushings and your car handle well. In the meantime you can pick up a set of Energy Suspension urethane bushing for your stock swaybar.