I'll second Bryan's recommendation of rebuild then turbo.

If you turbo then rebuild, you will probably end up tuning the car's ECU 
twice.  Do you want to spend the money and time on that twice?  You 
could also couple the installation of the turbo kit with the engine 
rebuild and save on doing some of that stuff twice.  Personally, I hate 
doing stuff twice especially when I had the foresight (but ignored it) 
to avoid it.

I wish I had put a known good engine in my turbo car while it was down 
and I was working on building it back up, as it is now dead again due to 
most likely, a spun bearing.

Unfortunately, I'm effectively forced to repeat my "mistake" on my RX-7 
project (using a motor of dubious disposition as a placeholder) but am 
actively planning on swapping in a rebuilt motor as soon as I fabricate 
all the ancillaries and see that they run "okay".  Breaking in a rebuilt 
motor in AND having custom-fabricated stuff to sort out (that's the main 
project, the custom fab) violates the "changing too many things at once" 
rule a little too much for even me to handle.

Regards,
--Ashraf
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