But it fits in the 1.6 block without modification?
is it not a flat cylinder head on them? if so, skimming it won't do much to raise the compression. not sure about piston to head clearances on them engines, but you might get away with a thinner head gasket. failing that you might need to skim the block and pistons slightly. I would be aiming for at least 10.5-1 cr before considering fitting an uprated camshaft.
it might be possible to use the long stroke crank with the standard rods/pistons. you would need to shim the headgasket up though. if you could make it work, it would not only give you a little extra cubes, but it would also increase the compression ratio a little. you would need to break any wear ridge on the top of the cylinder bores though, as the piston rings will be going slightly higher than before.