The main advantage of the 160HP Lycoming over the 145HP Gypsy engine for glider towing is the finer prop of the Lycoming which gives you a better rate of climb than the coarser Fairey-Reed prop of the Gypsy. The extra 15 HP don't really feature.
The disadvantage of the Lycoming mod is that you can't (legally) turn the aircraft upside down. Also the Gypsy is far more robust than the Lycoming.