I struggled with this event for a while as well - even after I 'mastered' the track it was still pretty challenging for me with some of the car setups.
Here's a setup I used to get pretty consistent high 59 second times (I passed the #1 GT-R as well as the 300ZX he's stuck behind early on in the 9th lap and finished several seconds ahead)
(note: I use the driving force GT, TC:1 everything else off except skid recovery force.. without skid recovery I couldn't get below the high 1:00 lap times and that's not quite enough to get first... your mileage may vary)
RX-7 Spirit R Type A (FD) '02 (the premium model from the dealer)
- Carbon Hood, Chasis Re-inforcement, All Lightweight mods (1051 KG)
- Misc. engine mods to get it to 393 HP (many combinations will work, I chose to not upgrade the turbo and use exhaust and engine tuning)
- Added Aero Kit
- LSD, Custom Tranny, Clutch and suspension
- Custom wheels
Settings:
Aero: 0/28
Transmission: Max Speed 149 (this is higher than most of the other setups)
LSD: 40/45/5
Suspension (F/R):
Height: -15/-10
Spring Rate: 11.0/4.5
Extension: 9/5
Compression: 7/3
Anti-Roll Bars: 2/6
Alignment (F/R):
Camber 2.5/1.8
Toe .15/-.15
Brake Balance (F/R): 8/5
In general once you get the feel of cutting the turns properly without loosing the back end it's just a matter of keeping a smooth, steady pace.
With the tranny set to a slightly higher Top speed I was able to get the car to 127-133 MPH in the final straight which can shave a few tenths off of a lap time, provided that you're able to smoothly bring the car down to the mid to upper 70's through the final sweeping turn.
Good luck.