As far as the iron block being more durable than the Al block-I can say that in all the engines I tore apart for my project the Al engines had blown head gaskets and none of the iron blocks had blown head gaskets. I'm not implying all aluminum engines are going to blow head gaskets-just that more cars with aluminum engines are junked with blown head gaskets. It took 3 5.6 engines to get enough "1" size pistons that were not trashed by being run with a blown head gasket. If properly maintained I'm sure the Al engines are fine but they do not tolerate being overheated like a iron block does. It pulls the heads bolts out reducing the clamping pressure allowing the head gasket to blow.
With regards to increasing power output the K-jet is the best 4.5 engine to start with though due to the 0 deck height of the pistons allowing a true squish area if you blueprint it to .040" or so. I don't think the factory tolerance for mass produced engines gets it closer than .060 .070 or so which is out of the area providing the benefit. A aluminum block head gasket is .049" vs an iron block gasket which is .075". Might give you something to play with. I have a new spare 3.8/4.2 head gasket I could send for shipping.

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Tony H
W111 280SE 3.5 Coupe
Manual transmission

Past cars:
Porsche 914 2.0
'64 Jaguar XKE Roadster
'57 Oval Window VW
'71 Toyota Hilux Pickup Truck-Dad bought new
'73 Toyota Celica GT