You only need what you can feed, the rest is just in the way.  But at low speed you can feed a pretty good sized engine.

 

There are a lot of 360-400 inch engines that do really well and some 400 plus inch ones do verry well and some do verry poor.  Good matching components is the most important factor in the engine, displacement is lower on the list.  Don't put the cart in front of the horse.  Figure out how hard you are willing to work, what equipment you have or have access to, or how much money you will spend on a cylinder head and manifold.  The short block will be the easy part. 

 

If you want to be competive in Div 4, it's going to take at least the verry high 300's  for displacement.  Once you start buying parts, boreing and strokeing, the cost ireally isn't much different no matter what size the parts are. 

 

I'm just a little unclear of the rules you have to follow, you state div 4, so assumeing it's NATPA div 4 you have no ground speed limet  and 20% over the highest rated engine RPM for that series of engine and can use any ag carb.  At least those are the last rules I knew about and what they have posted.  But I've seen different clubs and rule sets and you state 7mph.  It's going to make a little difference in the engine build as to what you need to run for speed and what you can use for manifold and carb, gear selection, etc.  WC's are geared pretty fast compared to other gear sets or chassis.  If you can only go 7mph, figure out what 2nd and 3rd gear, what RPM makes what ground speed chose a tire, gear, or ring and pinion to match with just a little room to go faster.