You won't get out of it much cheaper with the LS1, but if you are handy you can do a lot of the Holden V8 conversion yourself. If you use a later Holden V8 engine, some are actually younger than the LS1's. VSIII were sold new into 2000 and overlapped the LS1's. You can still pick up low kM engines out of wrecks with 100,000kM or less especially from HSV VT and VSIII Maloo, so you might pick up a 195kW (304), 200kW (304) or 220kW (350). These will go in just as easily but have a few quirks that make them slightly dearer to install like twin O2 sensors.

However, $2700 plus $3500 isn't all that much for an LS1. Give it a cold air intake, single 3.5" exhaust (will set you back $1500+ with hi flow cats) and a tune and it'll pump out 280kW+ as an auto.

Is it going in a HZ commercial or HZ passenger vehicle? If it is a ute it might be cheaper to just go out and buy an LS1 powered VU-VY ute or 1-tonner?