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So here is the scoop from one of the members of Toyotanation DannoXYZ: gotta use oil pan with same engine, so keep the 1.6 pan when you swap 1.6 in. Yes, attach 1.8L's knock-sensor to 1.6L engine Use the smaller 1.6L injectors with 1.6L engine.

I just bought a 97 corolla dx with a 1.8 and a 4 speed automatic. The engine is toast and I have access to a 1.6 donor 97 corolla with a 1.6 engine, 3 speed automatic. Can I swap the 1.6 in place of the 1.8 pretty easily?