tell me about it mate - its damn annoying trying to work out what the best way to go is...
mild steel is more than ok - my extractors have gotten hot enough to melt the siren for my alarm (mounted near the brake booster) and they are still fine > mild steel.
get stainless if you want it to look pretty, but i have heard from a few people that stainless steel has more of a tendancy to break at the welds, more so than mild steel anyway. look for extractors with small primaries and nice flowing bends - not bent straight out of the head (i assume you have a I6?)
the size of the cam will determine weither or not you need a chip - if you want big power gains from a large cam you will need a chip to get it to idle correctly, ie no hunting and stalling etc. there is a massive thread in the I6 forums about this very subject, have a look.
IMHO the first thing you do to make your car handle better is drop it an inch or two (2" is brilliant, my XD wagon, old EB and current EB XR6 have all been 2" closer to mother earth) and get some proper shocks - Koni adjustables are fricken awesome, but pricey, stiffer pedders or monroe shocks seem to be pretty popular to people that actually have a life (im not one of them, hence more disposable income, hence i have konis :D)
lowering blocks are ok to use, and cheap, but reset leaves are the way to go if you have the cash.
lowering the car gives you more negative camber at the front - good if you take corners like schumacher, less good if you drive like a skirt. a camber kit is helpfull in reducing premature tyre wear - drop the car on its guts and get an alignment, they should tell you what your neg camber figures are, any more than 1-1.5 degrees is prolly too much, about 1 or a little under is good for normal drivers.
after the height is sorted, if you still think it has too much body roll, get a bigger front swaybar, it should help a lot.
i hope thats not confusing?
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