I've had both cars. The mustang is easier to drive however if you are looking for power then the LS1 is the way to go IMO. So far the highes RWHP from an LS1 I have seen NATURALLY ASPIRATED is 492rwhp. This is only h/c/i etc. I'm probly in the 420-450 range through an automatic. I plan to run it in the 1/4 after the track opens back up. LS1 cars will break 11's with ease, cam and little boltons. I would recommend an auto in the LS1 however if your looking for power because the manuals tend to snap the rears like toothpicks. Your typical H/C/I LS1 will get you into the low to mid 400rwhp range which I think is amazing for N/A. The mustangs are good too but to compete like most said you will need a poweradder especially with a modded LS1, even then a basic power adder won't be enough. I guess you could say I favor the LS1 more that's just because I've owned all of the vehicles your talking about. Granted the car is not as *easy* to drive it is definately more fun. Good luck with whichever you chose!
-Sly
-Sly