Heys, Jon what you are describing there is Amithalon, wich IMHO would of been the answer to ALL the problems of those amigans wishing to upgrade even though it doesn`t allow to run windows software.
However Its pretty damn cool and only emulates stuff that hits the cusom chips the rest is ported through..
The best way to think of amithalon is like a REALLY fast Amiga like my barton 3200 would be a 3.2Ghz Amiga... quite nice indeed since I love imagine for rendering
Unfortunately Amithalon is no longer sold (other than on ebay from time to time) A fellow Amigan on these Far boards (Charlie) helped me out with getting an original so PM me I might be able to do the same (it installs on native x86 hardware).
Another OS is AROS (Its very close to Ultrons Heart, and mine too in fact) although it looks amiga i still get the feeling of linux, mind you i get that now and again with a powered amiga so i guess i cant say that much..
AROS is free ware and you can download as you wish, just give it a google.
Talking about chips and cpus and stuff:
Motorola droped the 68k line of cpus in favour for the *much cheaper* cold fire cpus, ironically these bad boys have almost an identical instruction set with few exceptions to the said 68k cpus (there based on a reduced 68000 cpu) however they run at 100 / 300+ mhz so there is quite potential there.
if you search for minimig there the project went for a cold fire 3 and a little more searching with find Oli's A3000/4000 accelerator offering a cold fire 4 at 200mhz i think as well as the possibility of usb as well. it all looks good