Does anyone know what the biggest diff that could fit into a 1975 datsun 1200 deluxe and what is the best engine and gearbox that would fit perfectly with the diff.

You could try a Nissan H260 you might not have much suspension travel though before the bowl hits the floorpan, and while your at it you could fit a TD42 4.2 diesel You did say could fit!

There are several 1200s with Ford 9" differentials. I haven't heard of any bigger being fitted.

Read here: http://wiki.datsun1200.com/index.php/Rear_Axle_Swaps

Choosing a diff before anything else sounds a funny way to go about building a car, but almost any diff can be cut down to fit, a ford 9 inch would be as big as you would ever want, but I think it would be overkill and just too heavy unless you were going for a V8 though.

The diff from a 1200 ute is a good strong diff that bolts straight in, isnt heavy and will cope with a fair bit of power.

How strong of an engine can i attach to the diff from a 1200 ute

A turbo charged 1.8 could break it if you really wanted to, depends on your driving style and what you intend to use it for. If its a daily driver and your sensible it will be fine for most everything, but if drag racing is what your thinking, you might want a cut down Hilux diff.

well what i am planning to do with it is the occasional drag race and i'll be doing a lot of wheel spinning.

i have had a cut down mazda e2000 full floater in the rear of a 1200 ute i have had a h190 out of a vanette in a 1200 coupe and a cut down ford 9inch in a sedan ..
have run an sr20 turbo in the engine bay and that fits fine