I don't often chime-in on these discussions, but in this case I feel
compelled:

Engine:  Subby Boxer
Pros: Cheap, powerful
Cons:  Not VW therefore not very compatible - will require the owner be
the expert.  Many custom pieces needed.

Engine:  VW I-4 from a N.American car
Pros:  Cheap, decent power, conversion kit available from FastForward,
Most VW mechanics will be able to fix it., Long life.
Cons:  Usually involves using CIS FI (a step 'backwards' from a
full-engine management system), most of these conversion require the
engine lid to be modified, still a cobbled-together system.

Engine:  VW I-4 from S.Africa
Pros:  Perfect fit, built by VW for the Vanagon, VW Mechanics will know
this one too.  Lots of power, Very long life.
Cons:  Cost, some parts may be hard to replace in the future (coolant
hoses, etc)

Engine:  VW I-5 from N.America
Pros:  Great power, very long life (longer than I-4), VW Mechanics know
this one too., In the US these engine are VERY cheap at the wrecking
yards.
Cons:  Hard to get a kit to get the engine in the van, engine lid will
probably need modifying too.  Very few done.  Probably would use CIS-E -
this is a 'con' to 'neutral' based on if your van has Digifant or
Digijet respectively.

The way I see it, if you want to convert, the VW engines are the better
choice.  If you have a premium Vanagon or Westy and want 'the best' go
with TIICO's I-4 from S.Africa.  If you have more of a beater Van /
Westy or a lower budget get David Marshall's kit and put in an I-4.
Either a 1.8 or 2.0.  CIS won't be your best friend (don't get me wrong,
it's a very good FI system, BUT..) because it's not a full engine mgmt
system and won't be as smooth as Digifant.  Digijet, however, isn't as
sophisticated and the difference will probably be less noticable.  I
would think Digijet to CIS-E would be a very comparible swap.  If you
want the best bang for your buck go with a Subby but know that your
entire van's maintenance is basically your responsiblity now.  You'll
need to be a good mechanic too - things like wire connectors, etc, will
eventually kill you if you don't do them right.  If you're not
mechanically enclined fix your waterboxer.

I'm not trying to ruffle feathers or anything - every option has its
advantages.  I've thought on this one for a very long time and it seems
quite clear-cut.  I think one of the heuristics that cloud this issue is
that Vanagon owners, as a group, tend to be more mechanically enclined
so the 'average car owner' arguments don't apply as easily.  Here's my
profile to engine choice recommendations:

Cheap, not a purist, extremely mechanically enclined:  Subaru engine
(5%)
Middle-of-the-road on 'purist', cheap, somewhat mechanically enclined
(student, or paddler):  I-4 conversion (10%)
Purist, somewhat mechanically enclined, got a bit more money:  I-4 from
S.Africa (5%)

Everyone else:  fix/replace the waterboxer (80%)

Fixing the waterboxer is really a very good choice and you can sell the
van in the future...

Well, don't flame me!

Damian