I can't help but notice how often posters in this forum cry about money. I started building bikes with my father in the 1960's. Honda, Kawasaki, BSA, Suzuki, Triumph, Yamaha, and Harley Davidson all fell victim to my cutting torch and welder. I'm a good builder with 40 odd years of experience, and I've never built a really good bike without spending a bunch of money! Bike building is not about money in my opinion. It's about creating the bad ass piece of individualized art that my minds eye can already see.
I purchased an XS400 last September. Before that, I had a hopped-up Evolution Sportster with around 80hp. Before that, a shovelhead bobber with about 75hp, and before that. a shovelhead chopper with about 80hp. Before that, a CBR600 F4i rated at 115hp, and before that a Suzuki GS1100 that was pretty close to 100hp. All in all, it had been about 20 years since I owned anything that wasn't screamin' fast.
So ya, the XS400 seems down right anemic. That does not mean I can't make an XS400 perform the way experience tells me it's capable of performing. Yes, it's going to cost money; I estimate the engine build will cost me around $1200 dollars, and the rest of the build will run close to a grand. With the initial purchase I will spend around $3200. If you say, "It's not worth it," I will simply ask you "who else has an XS400 that will stand sraight up in the first 3 gears." Good fabrication and mechanical skills will take you along way, but the really cool stuff costs money even when you do most of the labor yourself.