Peter Koch offers the following thoughts why overclocking a 3/160 will NOT work

However, he also offers ideas on how to hack the hardware a bit more - fun fun!
1) Replacing the 68881/16 by a 68882/25:
   The CPU can actually feed different clocks into CPU
   and FPU. If you inspect the CPU board closely, there
   is an empty hole for an oscillator (marked 25 MHz).
   It was used for early 3004 CPU boards that ran at
   12.5 MHz.
   Fill this hole with a 50 MHz oscillator. There is a
   set of four jumpers between the two oscillators.
   Two jumpers are set, two are not set. Guess what:
   If you change these jumpers, you can feed the output
   of the other oscillator into either the CPU or the
   FPU. Refer to the Sun-hardware-FAQ for exact jumper
2) Overclocking the 3/160 CPU:
   The memory on the CPU board is 120ns. I've tried to
   run the CPU at 20 MHz (using a 40 MHz oscillator),
   but to no avail. I got memory errors after some
   minutes. Later i found a 36 MHz oscillator. This
   one worked with the 3004 CPU, but when i added my
   two 4MB memory boards, i got errors again (after
   some hours). So i guess the 3/160 is almost at its
   limits with 16.6 MHz.
   On the other hand i've sucessully overclocked several
   Sun 3/60 from 20 to 24 and 25 MHz.
3) Replacing the ESDI disks by SCSI disks:
   The limiting factor for speed is the disk controller.
   Your Sun-3 controller can transfer about 1 MB/sec
   in the 3/160. Not more. Your Micropolis disks should
   be able to sustain a rate at 700 kB/sec.

So, apparently, the problem with overclocking the 3/160 is the 120ns RAM. 3/60's tend to use 100ns SIMMs, hence they are more forgiving about being overclocked. The following is an exchange where I suggested ideas to get around this problem, and Peter's responses.

Idea #1 - Replace the CPU and memory boards with something better (like a 3/260). This is the "suggested upgrade" in the hardware FAQ, but of course, the most expensive solution.
A 3/260 fits nicely into the 3/160 case. You only have to
replace CPU and memory, all else works. The 3/260 is much
faster! It runs at 25 MHz and does have a second level
cache. In fact: The 3/260 is the first microprocessor
driven Unix-Mini with a second level cache. See the FAQ
for details.

Idea #2 - Overclocking the CPU - but changing all the RAM chips to something faster.
Mmmh... That's a lot of work and you have a good chance to destroy
the CPU board. It's 6 layers ;-)

The other thing to think about is heat...
Yes! This is very important. For that reason i changed the
memory to faster 80 ns types (not that the 100 ns types
didn't work, but these become very hot) and preferred
the 3 chip types over the 9 chip types.
Where available, i put in a CPU with higher ratings.
Not that the 20 MHz CPU won't work at 25 MHz, but a
25 MHz CPU doesn't become so hot.

Put cooling devices (passive) onto the CPU and FPU.
Clean the air inlet and make sure the airflow is ok.
That will suffice.

I think in this above section, Peter is discussing a 3/60 - which uses 100ns 9chip SIMMS as standard. However, there are alot of 3/60's out there and I think this discussion will benefit everyone hacking their hardware.

Where I'm at now:

Well, it's clear that alot of the plans I made to try and speed up the existing machine are closing - the 3/160 was engineered as well as it could be for the time, and the parts inside just don't have much headroom for tinkering. At this point, my options are limited to clocking the FPU higher, though that won't gain me much. Aside from that, my only other recourse is to replace the insides, which is what I probably will do as I've recieved some VME boards from various sources, and once I figure out how to combine all the parts in their best combination, I'll be building a new machine in the old chassis.