The idea of putting a powerful V8 in a small vehicle is always exciting, but this is not the V8 I would choose nor the vehicle I would put it in. Nice effort though.
The V8 powered Miata mentioned above would be a good alternate direction.
I think my choice would be a V8 like this:
https://jalopnik.com/5272575/ariel-a...d-by-500-hp-v8
(Which is great in the Atom too, of course, but that's not remotely DD-able)
In this car:
https://en.wikipedia.org/wiki/Lotus_Exige
Should be much lighter, roughly twice as quick, and offer much better handling than the V8 Cygnet.