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4 cyl. head relations

Wanted to thank the individuals who responded to my questions
regarding head codes. They were quite helpful, but at the
same time, they have posed other questions.

I have been informed that the 118 head was a european head that
was used on the 1.6 and 1.8 liter engines of the late 60's and early
70's. Which makes perfect sense considering the 1970 block the head
is on. This leaves me with a few new questions. If I put the 118 head
on top of a 2.0 liter block, using flat top pistons (obviously losing
compression) will this engine be a dog, considering the smaller valves?
Should I have the crank in the 70 block ground and put in new bearings
and use that block instead? That block has the high compression pistons.
Would a 2.0 liter crank work in a 1.6 liter block? Will a camshaft from
a E21 head work in the 118 head? 
Some of these may seem like stupid questions, but I don't know the 
answers.

Any advice would be appreciated.

Thanks again,
Rich
2002 seeking unity