From an article/tutorial at the Super Chevy - Chevy High Performance web site entitled "GM 350 Crate Engine Build - The Goodwrench Quest" and dated September 1st, 1999:
The Engine
The Goodwrench 350 is unquestionably bread-and-butter basic. While all production small-blocks have employed a one-piece rear-main seal design since 1986, the Goodwrench 350 is assembled in Mexico and retains the classic two-piece pre-’86 design. This makes it an excellent choice for a basic hot rod motor for all pre-’86 cars since you don’t have to purchase a new flexplate or flywheel.
Read more:
http://www.superchevy.com/how-to/46320-gm-350-crate-engine-build/#ixzz3UdwI0rcr
Bear in mind that refers to only where the block is cast - not where the engine is assembled. Incidentally, by all accounts, the quality of the finished product coming out of Mexican foundries is excellent. Some would argue that it is better than what came out of the US foundries before they were shutdown in the late 90's.
Also, GM retains tight control over the manufacturing and quality control process.
The biggest issue to be concerned with is who/where the engine will be assembled and dressed out. While I am sure there are a few companies that do their final assembling in Mexico (ATK for example) most block are shipped to the US and assembled/dressed by one of the many engine retailers.
As far as where the Goodwrench/Targetmaster engines sold by GM are assembled - IDK. But you can be sure of one thing - no matter what new crated SBC you buy, the engine block was "Hecho en Mexico" (Made in Mexico).
Be more concerned with the who assembles your engine than where the block was cast and machined.
A side note from my experience with crate engines (and I can't go into details right now):
While you can assume that the engine block will be okay and it goes without saying that you will "get what you pay for" as far as cylinder heads and internals (pistons, rings, bearings, cam, crankshaft, etc.), it's the little things that make the difference.
Before you chuck your OEM motor, take some time and try to salvage any parts that you think you might be able to use for the new engine. By this I am referring to mostly small external parts.
The quality of GM's OEM fasteners is outstanding. The same goes for any brackets, clips, hold downs you can save. Like the spreaders for the valve covers; the OEM spreaders are the best. Some stuff isn't even available anymore. Consider that little retainer that keeps the transmission cooler lines steady and close to the engine. And the clip that is used to properly route the positive cable from the battery to the solenoid:
You must be registered for see images attach
You might be able to find those two little items on ebay - if you search for months - but you can't buy them from GM any more.
I said I wasn't going to go into details - so I'm done.
