A little late to get back to this, but such a good thought exercise. How to decrease the scale of a competitive U4 car is definitely a hard one to pin down. I think the conversation you guys had is along what will happen (at least one of the routes explored). Aluminum 4 banger, some sort of "traditional" transmission instead of a CVT, FIS and portals, any something around a 37" tire. Those French buggies Bebop posted are pretty intriguing. I think they may be on track for the overall scale, but we'll probably see many different ways of arriving there.
The ford ecoboosts, chevy ecotecs, and hell even some Honda 4 bangers seem like great powertrain candidates.
Here's a funny one - could transaxles be revisited (moon buggy style)? Very dense, efficient packaging, probably notably higher efficiency than our regular standalone transmission + tcase. Gearing has always been the issue, with moon buggies topping out at like 50mph because you're taking the original wheel outputs and reducing them again with the rigs differentials. But because we're looking for the ultimate with no holds barred, Can a custom final drive gearset be made to get them into a useable RPM range for up to ~120mph wheel speed? And because the pumpkins in IFS don't move, you could almost hook the transaxle output directly to the pinion snout of either the front or rear diff so packaging is pretty flexible