They handle very well. I love the way my 5th gen handles.
The 5sfe is definately an economy motor, however there are guys that turbocharge them... and one guy just over 200 whp on the stock bottom end.
You can always swap a 3sgte into them too
I love everything about them, and without going into great detail, I couldn't tell you everything about the motor. They're very stout, very torque, lots of fun.
As far as body modifications, there are a ton of kits out there. Toyotocelicaonline.com has a guide for those. There is also the CS bumper/hood combo, as well as the Celica Alltrac hood that will fit, those are very nice looking as well.
Lemme know if you have any more questions.
Colin