Better Performance/ More HP (maybe?)
 

I have an 2006 Chevrolet Monte Carlo LT and I was wondering for one, is there a possibility for better gas mileage. Also I was told i can change the air intake system to a K&N one, but other than that is there more ways to increase hp; like a motor swap, tranny, ext.?

Easiest way to get more MPG is to keep your foot out of the throttle. A K&N filter claims more mileage do too better air flow but it's debateable, a few way's that can help is proper tire pressure, remove any excess weight (tools, box's ect) a good tune up, even a clean car will make a difference ( less wind resistance) don't expect a big difference but they all will help IMO.

To be honest, your goals seem at odds with each other- more gas mileage and more power, especially sticking with the current engine. Some mods will increase the efficiency of the engine across these board and will help both (usually at a cost somewhere else), but that kind of stuff will only take you so far. When you start getting into the bigger HP mods, mileage often suffers.

As far as a K&N intake, I definitely wouldn't do that for fuel economy. Not sure what they sell for, but at say $300, you could buy like 2000 miles worth of gas. It would take a long long time to pay for itself even at a 1 mpg gain.

As far as power mods, and engine swap is certainly an option. Just depends how deep your pockets are...