really, it sounds like this mechanic either doesnt know much 'bout turbos, or is trying to rip you off. First off, theres virtually no need/reason to spend the time/money to move the turbo to a more conventional location like he mentioned. Sure its not the best place for it on top of the engine, but guys have been able to run 11s/12s with the turbo located there. Unless you plan on making it a REAL fast car (which it sounds like you don't), there'd be no reason to consider moving the turbo... and if you DID want to do that, it'd be a LOT easier to convert to an 86/87 setup than to fabricate all your own stuff.
Secondly, when you have your turbo rebuilt (by a reputable shop, there are many to choose from, take any of the recommendations you see on the board here) it will last a good long while. If it fails within a year, it was either rebuilt wrong, or installed wrong.
from what you've said, it sounds like you should maybe consider getting a different mechanic. I could be wrong, of course, but thats my first impression. If I recall, Brewster is north of NYC, up near the border by Danbury. If you ask on the board for recommendations for a Turbo-Buick friendly shop in your area, I'm sure theres one within an hours drive of you. If you go someplace knowledgeable about these cars, you wont have to worry about them trying to relocate the turbo for no reason, and they'll use a reputable re-builder for the turbo, so you know it wont fail in a year.
Hope this helps