Brian-- Although I have a 1.8t which is more easily modded, I just read this over on Audiworld.com on an engine mod that would increase hp to 230 on the 2.8. In fact, the guy on AW was asking the same question on the same model year ('96) as you are. Here's the link that was given as a response: http://pub20.ezboard.com/fcomputersarebadfrm3.showMessage?topicID=15.topic
As far as the A/C goes, I had estimates of anywhere from $1,500 to $2,000 to have the air conditioning fixed on my old Ford Probe so I don't think the figure you were given would be too far off.