Moneyguy: Point taken. Still, there has to be more to the use of a 4-cylinder than simple stubborn-ness. If I had to hazard a guess, it would be that prior experience (with the 914/4 and the original 924 with the Audi engine) taught Porsche that sharing obvious componants with VW/Audi was a big no-no in the eyes of the public.
If I remember rightly from Leffingwell's excellent book
Porsche Legends, the original 924 was supposed to be a VW exclusive, but VW axed the project. Porsche picked up the original 924 only because the union at which the VW 924 was to be made was very upset with the loss of jobs when VW canceled. When the original 924 got the same "vopo" reputation as the 914, Porsche was left with very little choice than to re-design the exterior a bit and to change the engine to a "genuine Porsche" unit.
I agree that there are a lot of larger and vibration-free engines that can be made to fit in the 944/924S, but given the technology of the period, and the fact that Porsche was aiming for balanced handling pretty much limits the engine choices they could make. The engine had to be light, even with the small straight-4 the car is slightly nose-heavy.
This has been a great exchange by the way. I've been on more than a few other forums where this would have degenerated into a flame war. Thanks for keeping it an informative discussion.
Aaron