You won't need better pistons as the inlet maniofold won't let you get much more out of it. You'll need throttle boddies and serious induction mods to run lairy cams which will be a bit more noticable on the engine. 90bhp is going to be about your max.
You're right, its not technically illegal to be insured as a named driver on your dads policy, however should you try and make a claim they may well say that you're clearly the main driver and not pay, you'll have to take them to court where you'll more than likely loose as the accident will have happened on a regular trip, proving that you're the main driver. You're also not insured to use it for your commute to place of work/school as well.
You can tell me its all bullshit etc if you want, I'm not that bothered. Fact is that a few people have now been stung on this and have had to pay out to third parties themselves, inconvenient when 200k is involved for causing a perminant injury. At that point you'll also find that your insurance has been revoked, leading to a driving without insurance charge