yes but as a bigger engine was fitted, you'd need more fuel, possibly a larger wingspan, and the airframe would need considderable "beefing up" to take the stress..........
The only thing the Merlin really had going for it over the Allison was that RR had designed a supercharger stage to fit between the valve bays. This meant that only one stage had to be fitted externally, so it lead to a more compact design. It was harder to maintain though because of this compactness.
The Allison was smoother running and developmed just as much power for weight for a given level of boost as the Merlin.
It was, as long as it had a two stage supercharger or a turbo-supercharger. The problem with most Allison engined planes earlier on in the War (P-39, P-40, P-51A) was that they had only a single stage supercharger. The P-38 is the exception, and it had good high-altitude performance from even the earlier models (though the pilot would freeze his butt off), because it included both a single stage supercharger plus a turbocharger acting as the second stage.
The P-39 was originally designed to have two stage supercharging or turbo-supercharging (I cannot recall which), but the idiots at the US ordinance commitee (Congress) thought they were also skilled at aircraft design and felt the scoops would hurt the aerodynamic lines of the plane and dictated they should be removed. This was rectified in the later P-63, which had good high alt performance.
Because when the British specified the P-51 it was to be in the same class as the P-40, which meant only a single-stage supercharger (as also found on early Spitfires). Thus it was much easier to adapt the Merlin 65 engine, with it's internal supercharger stage, into the P-51 to have two stages of supercharging. If this had been done using the Allison, the plane would have had to have been more significantly modified to incorporate a 2nd external supercharger stage.
On the otherhand, the P-51 probably would have gotten a turbo-supercharger if it had not gone to the Merlin. it would probably have had to be located behind the engine, and the fuselage lengthened accordingly.