Hello Carl, and welcome to NSR-WORLD.COM!
A MC18 Mk1 (R2J/R4J) seat unit should fit without too much trouble, as the subframes are very similar. You may find it easier to find a Mk1 subframe though, so the MC18 seat will fit right up.
The Mk1 lowers are all but identical to the MC16, but the uppers are different... a little sleaker, and with the dinky headlight. The MC16 uses a much larger/heavier "frame" that both the instruments and top fairing are bolted too, which will need to be replaced or heavily modified if you want to use an MC18 nose fairing.
The MC16 isn't restricted, and unless you use HRC parts it's never going to make much more than 50~55hp. The best bet is to source some MC18 barrels, carbs, and exhaust pipes. That should see power up to around 60hp (from 45hp).
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Andy.
NSR-WORLD.COM
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