A 292 would be your best bet, in my opinion. Sure a 302 would probably produce slightly more hp and torque (I've never seen the stock specs for the 302 so I wouldn't know). But the 292 is much more plentiful than the 302, and probably has equal, if not greater, high end output potential. And the 292 has a more rugged bottom end (7 main bearings vs. 4 for the 302). Plus you have a near endless number of transmission combinations you can run behind the 292 (TH350, TH400, 700R4, M21, T5, T10, Saginaw, etc., etc.) without modifications.
Here are some more factors to consider:
The newest 302s are older than the oldest 292s. 292s ran from '63 to '90 so the latter 292s are just over a decade old. The 292s can also be bought as a new longblock from GM, and many of your auto supply stores (Advance Auto, NAPA, CarQuest) can still get 292 longblocks and shortblocks easily.
No knocks against the 302. I hear it's a great, very strong engine. But the 292 is simply more plentiful, much lighter in weight, has a modern oiling system and 7 main bearings. And hop up components are easier to find.
-ftyler
