It really depends on how much work/time you are willing to put into it.
Personally I like you second option best, mounting your screen up more. This gives you serveral advantages and won't be as distracting vs. having the screen lower. If you placed the screen in the lower position, it is going to be harder to switch songs and stay focused on the road.
However, it takes more work moving you AC/heat controls and such. It will some time and a good amount of research.
Also, the Lilliput should come with a remote that allows you to do the functions you need. Just don't cover up the IR sensor.
cheers and good luck