1) As it has been stated; a good 2.5" system will support over 500hp without issue.
2) yes mandrel bends matter
3) and exhaust system is a SYSTEM and many/most people underestimate the importance of muffler choice; the difference between a crappy flowing muffler like a Flowmaster and a good one like a Dynomax Ultra-Flow is HUGE.
3" pro's
- all other things being equal (mufflers, mandrel bends) then the 3" has room to grow if you want 600 or 700hp later.
3" cons
- price
- space restrictions (like the fuel cell note above) can make install and working on nearby components more difficult.
Dave