The Ford Panther line are the Crown Vic, Grand Marquis, and Town Car. The Panther line got the 4.6 PI motor in 2001. Sooooooo a 4.6 out of a 2000 and older is virtually identical (long block) to the motor in your 96.
But wait. There's more. It's quite possible for you to perform a PI upgrade by choosing a motor from a 2001+ Panther. Since the Ford Panther was in production until 2011 it's possible to get a very late model motor from a wreck.
Likely the motor from a Panther has lead an easier life than from another Mustang. Further you won't have to pay extra because it's a Mustang.
IMO I would avoid any motor from a police car. Why? Because police cars spend soooooooo much time idling. Therefore miles is a poor indication of the ware upon the motor.
Bottom line there are TONS of salvage yard 4.6's out there to be had for very reasonable $$'s. Just search on car-part.com for some salvage yards in your area. LQK is another source to look at. Don't think that $500 for a high mileage 4.6 is a "steal" because it's not. For example, I paid $800 for a 32K mile 4.6 from a 2003 Grand Marquis. That was 5 years and 60k miles ago.
Here's another trick I have used when looking for salvage motors to keep the yard honest. Salvage yards are required to retain the VIN number that all parts come from. Ask for the VIN and run a CarFax report. The CarFax will likely contain when the car was salvaged and the mileage. In my own case I found on one motor was looking at that there's was a sizable difference in the advertised mileage and the CarFax mileage. Clearly some salvage operators are more honest than others! (yes she really is 18 and this is her first time).
Finally. It's possible that your current motor is savable. The front timing chains are bad about wearing through on high mileage 4.6's. This can be repaired if caught early enough (this is what killed the original motor in my 2000 GT). However my recommendation is to perform this inspection with the motor on an engine stand. This is be best way to clean out the oil pan and to get access to a through inspection.
Good luck.