This thread brings back memories! lol. If I wanted to create something different and unique, it'd be putting a M117 5.6 32v engine in there along with the gearbox and tranny. Not too many 124's left with that set up now.
Back to your dilemma, I'd put in a M104 3.6 L from an early donor C36 without the electronic mileage on the dash. Then you'll have 6 sweet cylinders pushing out 270 horses, plus it'll still look like a factory install.