I'm not that familiar with xfires yet but I can vouche that rear mount setups definitely work. They are a very easy to setup system and are very popular with the fbodies, not only v8's but the 3.8l v6 guys run them too from the modified 2.25 stock piping with great results. From an engineering viewpoint they are not as efficient as front mount setups due to the fact you loose a lot of exhaust velocity/heat with the turbo position that far back, however they do work and the fact that you can realistically build one for under 2k outweighs most its other shortcomings.

What would you do for tuning on the xfire PCM though? I don't see there being any tuners available other than mail order tunes and that wouldn't work with something as custom as this. You could run an FMU.... but I don't know if that would work on these engines or not.