QUOTE- "Is it worth purchasing a rear 500W torque kit (similar top speed but greater torque) instead for a few more dollars?"
You are looking at the motor rating with an eye accustomed to looking at gas engines. Electric motors are different, the wattage rating has more to do with efficiency at a given rpm. The 350 watt motor will be fine for your selected battery.
QUOTE- "How will the same 39V 9.2Ah A123 Pack battery cope?"
Likewise, this battery will be fine with your selected motor.
QUOTE- "Also will the battery fit into a triangle falconEV bag?"
Easily.
QUOTE- " ... I have a choice of fitting out either my flatbar road bike with 700c wheels or my mountain bike with 26" wheels.
Recommendations for choice?"
Yes, the MTB.
From Cell/man site,
QUOTE- "As a guideline you can expect approximately the following real world speeds for the above windings on 12S LiFePO4 battery pack (approximately 38V under load) in a 26” rim on the flat, no pedaling with a rider plus bike weight of approximately 130kg total (286pounds):
8T – 39kph (24mph)
10T – 32kph (20mph)"
Sub'ing the BMC V1 for the 10T @ on the Ebike CA simulator[approx. same no-load rpm] and using Cell_man 52V 11-5 battery gives a top speed of 24.5 mph with fair climbing ability.
Bottom line, if you have small hills to negociate, the 8T @ 39V is ok.
If you have more formitable hills, the 10T combined with Cell_man's 52V 11.5 triangle battery would be a better choice.
No-pedal range would be greater, 15-20 miles, than with the 39V 9.5 battery, which would be 12-16 miles.