Really depends on the type of racing that you are going to do and your level of experience in handling a fast 1/8th scale car.
You can start with something as simple as the O.S. VR-Z version II Turbo for under $300 or go with the full race Nova Rossi 359 (tuned) near $600. You will also be able to find a number of motors in between these two as well. I would encourage you to visit with the other 1/8th drivers that you will be racing in your local area to see what they are running. That way you will likely find more knowledgable help in tuning your motor after break in. The pipe will differ depending on what you are wanting to attain from your motor, fuel economy, bottom end (tight track), top end (large wide open track). Again talk to your local guys and the local hobby shop that sponsors your races (if applicable).
Good luck,
Roger