Look I'm not gonna turn this into a 240 vs ae86 argue, but saying that the 240 can do anything the ae86 can do better and for cheaper is outright wrong. They both have their strong and weak points.
As for the 4ag motor, there are plenty of builders making 260+hp at under 9k RPMs naturally aspirated, and the 7ag stroker motors go further than that. They also make plenty of power boosted, I've seen a twin charged 4age making 500+hp with the stock 1.6L displacement and even more when stroked to 1.8L.
Making power with those motors are cheap and easy as well, if you have an ae86, swap in a 4agze bottom end ($100-150), custom fab your own turbo kit (let's say around $500), put some crazy boost into and you'll be in the 250+hp range. Throw in a set of cams, up the boost even more you'll be pushing crazy numbers for a tiny motor. These DOHC motors breathe extremely well. If your tranny goes out, throw in a cheap W58 from a supra and call it a day.
Even with all the hp potential, you still don't even need that much power for something that can be stripped to sub-1800lb.
This is the last time I'll say it, the ae86 and 240 are completely different animals. It's like comparing apples to oranges.
And please explain to me how the 86 is a copy of an escort.