Re: coilovers... As applejack mentioned, they have a better "motion ratio". To oversimplify, this means that the spring attachment point is near the end of the control arm. The advantage there is that if you apply a 100lb force to the tire, it only takes a 110lb spring rate to control/resist it. With the stock setup, the spring is near the middle of the (lever) arm, meaning you need a 200lb spring rate to provide the same resistance. Anytime you're dealing with "softer parts", there's less friction, and almost always less unsprung weight involved... The other big advantage of the coilover setups is adjustable ride height - can be a nice feature. All "necessary"??? Probably not, but then again, neither are 4-barrel carbs and dual exhaust. ::
Now, onto arm construction, which is really a different subject... You can modify your stockers and achieve acceptable results, depending on YOUR wants/needs/ definition of acceptable.
Box it, and make it strong. Then, add additional reinforcement to the spring perch mount and balljoint areas, as both are crack-prone. Now, you've got a strong arm, although it's relatively heavy. (Before someone says "but GW arms are heavy", realize the arm itself is light (unsprung weight) - the solid billet inner pivot shaft (sprung weight) is heavy.
) Speaking of which, your modified stamped arms still have the crappy stock inner pivot bushing - a known problem area, and the reason for 1/2 the suspension rebuilds people do. What you don't have is a shorter arm for faster negative camber gain geometry (GW arms are approx 1/2" shorter). You also have how hours of labor? I know how much $$$ I value MY time at... :shocked2: Oh, and you DID start with NEW arms, new balljoints, etc, instead of using fatigued 40 y/o metal, didn't you?
aranoid:
Finally, realize that there is no "correct" answer. Everybody on here chose the components they did based on THEIR needs/wants/budgets/goals... Nobody chose the way they went because they thought it was the "2nd best choice" for them... :: My definition of great handling is not necessarily the same as the next guys... :highfive:
Finally, realize that TIRES are the biggest variable. While trick / fabricated parts are "fun", it doesn't matter what you use for suspension if you handicap yourself with skinny, hard, heavy, or soft sidewalled rubber...