Hi jsblendorio
Normally a HP500 would require a 1:5 drive unless you were planning on making a change later on, (Whipple, Procharger...etc) Our Boats with a 1:5 requires either a 30 lab or a reg 28. Typically an American Offshore with a HP500 will run upper 80's box stock at Sea Level. With the 1:36 drive you might want to try a 24 like Craig and Duck suggested, The limiter is 5200, or at least get your 26 labbed. Keep the 1:36 for future upgrades.
Trash as far as ride is concerned, Cats love chop, on our American Offshore 26's the rougher the better, but as the name implies, we're built for rough water, we are still running the single step (have been for the past 10 years, if it ain't broke... don't fix it)no porpoise in rough or glass at any speed, We're currently testing one in the low 130mph range and the boat is still steady, naturally at that speed we like the water a little calmer (1 - 1.5 chop)
Best of luck to you in your setup, give us a call if we can help with props, we have them all in stock and will do all we can to help regardless of the make!
Scott