When is Enough-Enough??
http://youtube.com/watch?v=9tNj7HG5Ow4
May to too much for those who think 'When is Enough-Enough'
The Best of Corvette for Corvette Enthusiasts

To answer your original question.
You only need enough HP to get the car up to posted speeds. I'm guessing 35HP max.
For many though, It's the thrill of the force of movement brought on by the larger amounts of HP.
While my own car is certainly not in the super-power category, I was looking seriously at an engine build that might go as high as 800 rwhp. Since this involves a LARGE chunk of change (the power adder is only a small part) I did a lot of research and talked to a lot of people, both the owners of high-powered cars, and the owners of the shops that build them. I also got rides in several high-powered combos although none, alas, made it to 800. The objective of all this was to try and find out what the right power level was for me without having to build 3 or 4 combinations to find out. If you really want an expert answer to this question, go ask in C5 and/or C6 FI for a while. There are quite a few guys over there driving around with 700-800 rwhp, or more.
Here are my impressions. This is my opinion and is mostly based on discussions with owners, plus a few right-seat rides. Other folks will have other opinions, and many of them will have more first-hand knowledge than I do. So fwiw.
The "upper limit" for practical everyday street use is somewhere between 500 and 600 rwhp. Many experienced people told me this. Over that level and the car is a smoke machine at less than triple-digit speeds. If you are building the car for very high speeds, then much more power can be used. There are (a few) people out there who need 800 rwhp or more to get the performance they want and use. But cars like this tend very much to be specialized weekend cars that are not driven much.
The issue is two-fold: tires and reliability. Regular, "non-R" street tires, even in the largest sizes, are at their limit hooking up 500-600 rwhp. Even then, anything at this power level is going to hook under certain conditions and not others. But you can get them to hook reasonably at least sometimes. DOT race tires can do much better, but then it's not a daily-driver car anymore, at least to me.
My strong impression is that the 750+ rwhp cars have to be "pedaled" under 80-100 mph, no matter what. Now some guys really like that, and more power to 'em, if you'll excuse the phrase, but a car that will light the tires in any of the lower gears if you look at the throttle wrong is not what I want for hitting the mountains. Still, somebody like JBSBLOWNC5 proves that it can work.

The other thing is reliability. It's not that high-power engines can't be reliable; they can. But making the engine and the rest of the car reliable costs some serious dollars and development time. Again, fine for a weekend toy, but too much for a daily driver.
So, my impression is that there are some guys who revel in the project itself. The car is in the shop much of the time getting fixed or upgraded, and that's fine. It sees a few thousand miles a year. Dyno numbers are bragging rights, but the point of the project isn't the bragging, it's the project itself. It's not at all unusual for such owners to sell the car, at a considerable loss, when the project is "finished". Then they're on to the next one. These guys often go for the big-power combos.
Then there are guys who just like to drive fast. They want to drive something that sounds and feels like a race car (even though in reality it's a long way from a real race car). They exercise the car, so far as they reasonably can, on a regular basis. Sometimes that involves the track, and sometimes not. For these guys, they typically stop somewhere in the 500s. I fall into this category, and that's why I decided on a new Z06 that will maybe get a cam and headers rather than a 800 rwhp C5.




















