President Reagan called yesterday for $110 million in increased military aid for El Salvador and hinted that if a reluctant Congress denies him the funds he may send more U.S. military advisers to the war-torn country.

In a sharp restatement of administration policy toward El Salvador and Latin America, Reagan also revealed that he will seek the first $60 million under a procedure that would short-circuit votes of either house of Congress.

To avoid floor fights, he is seeking permission to reprogram, or shift, to El Salvador funds already appropriated for military aid to other countries. He can make the shift unless he is denied permission within 15 days by either the House or Senate Appropriations subcommittees on foreign operations or the Senate Foreign Relations Committee.

A first test probably will occur in the House subcommittee, which has scheduled hearings on the request next week. Subcommittee sources said yesterday that the likely vote there is too close to call.

Reagan, announcing his intentions in a speech to the National Association of Manufacturers, said, as he has before, that the Salvadoran conflict is crucial to U.S. national security.

He called El Salvador "the first target" in a Soviet and Cuban campaign to spread communist "revolution without frontiers" up through Central America to the borders of the United States.

The administration also has complained of Cuban influence in the Caribbean nation of Grenada. One columnist recently disparaged this, saying Grenada is important only because it produces nutmeg.

"It isn't nutmeg that's at stake in the Caribbean and Central America," Reagan rejoined. "It is the United States' national security."

But many in Congress see El Salvador as possibly another Vietnam and think Reagan should emphasize conciliation more and military aid much less.

House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.) said yesterday of Reagan's new request: "I don't see the votes around here at the present time unless there's a complete turnaround in the Foreign Affairs Committee . . . . He's going to have to do a lot of selling before the House is going to buy that."

And whatever happens on the first $60 million, other Capitol Hill sources seemed to agree that Reagan will have trouble in the House on the other $50 million he is seeking, which will have to come to the floor.

At the least they anticipate that conditions will be attached aimed at tilting U.S. policy away from military activity and toward a political and diplomatic solution of the Salvadoran civil war.

Rep. Stephen J. Solarz (D-N.Y.), who has been in the forefront of House liberals advocating such a shift, predicted that the president's requests would lead to a savage floor battle and said: "By the end of the day, the administration will get the additional funds. The real issue is what conditions will be attached."

In his speech, Reagan's main emphasis was on the communist threat to Central America, which he described in terms reminiscent of the Vietnam-era "domino theory" and on the military situation in El Salvador, which he said is "not good."

But he also moved to assuage his congressional critics by long passages on economic aid, human rights and democratic elections in El Salvador. A senior administration official said "the president's purpose is to provide a shield behind which an economic and political solution can emerge."

In addition to saying he would take the $110 million from other administration programs to prevent increases in the world-wide level of U.S. military aid, Reagan called for a companion program of $168 million in increased economic assistance for El Salvador and other Central American countries.

Addressing fears of a broadened, direct U.S. involvement in the war, he said, "Are we going to send has represented industry on the Clean Air Act for the last two years, as the director of a lobbying group comprising more than a dozen major oil, paper, chemical and automobile corporations, he likely would be required to recuse himself from any EPA business involving the Clean Air Act or those corporations. According to Senate aides, he also earned the enmity of Stafford by characterizing him in a newsletter as an "environmental extremist."

Stafford said yesterday that the appointment of Quarles "would mean business as usual at EPA."

Other names suggested as candidates for the vacancy at the EPA range from Donald Kennedy, a Democrat who was Food and Drug Administration chief under the Carter administration and is now president of Stanford University, to Millicent Fenwick, the New Jersey Republican defeated in her Senate bid last year.

Many of the names are familiar from two years ago, when the White House spent months sorting through candidates for the EPA before selecting Burford, then named Anne M. Gorsuch. Among them are James R. Mahoney, founder of a Massachusetts consulting firm that caters to industrial clients; Henry L. Diamond, a Washington attorney and former New York state natural resources commissioner, and Stanley W. Legro, a Californian and an EPA enforcement official under President Nixon.

But the speculation also included new names, among them Carol E. Dinkins, assistant attorney general for land and natural resources, and Patrick Raher, a Washington attorney who has handled regulatory matters and lawsuits for both environmental and industry clients. They both said they had not been contacted by the White House.

Another potential candidate is Charles R. Ross, a former official of the Federal Power Commission who is now a private attorney in Vermont. He is popular among conservationists for his strong pro-consumer philosophy.

Some congressional and environmental critics of the agency said a change in policy would require more extensive administrative changes. "They are going to have to clean house over there," said one Senate aide.

In a briefing for senior EPA staff members yesterday afternoon, Hernandez did not indicate he would make any personnel changes. But EPA employes at all levels said they expected some people to go eventually. "A new administrator will want to put his or her own people in place," said one senior official.

The EPA already has hired a new public affairs director, William J. Ahlfeld, a vice president of the American Forest Institute.

Ahlfeld sought to generate some positive news yesterday by disclosing that Hernandez expects to announce next week a proposed compromise agreement that would give 111 counties that are violating the Clean Air Act more time to avoid federal sanctions. American soldiers into combat? The answer is a flat no . . . . Are we going to Americanize the war with a lot of U.S. combat advisers? Again the answer is no."

Although he stressed that the greatest need of the Salvadoran armed forces is for more training, Reagan said, "We think the best way is to provide training outside of El Salvador, in the United States or elsewhere, but that costs a lot more. So the number of U.S. trainers in El Salvador will depend upon the resources available."

The senior official, who spoke with reporters on condition he not be identified, was even more specific in suggesting that there is a direct link between how much assistance is approved and the number of additional advisers or trainers that might be sent into El Salvador.

Noting administration estimates that it costs 10 times more to train a battalion-sized unit in the United States than in El Salvador, the official said, "If we receive the full amount of the request, we propose to do all or most of the additional training out of El Salvador . If we get less, we will do more in the country, and we will need more trainers there."

In discussing calls for negotiations between the Salvadoran government and its guerrilla opponents, Reagan called on the rebels to lay down their arms and participate in plans for accelerated elections.

But he reiterated his opposition to talks that would be "a cynical device for dividing up power behind the people's back . . . that would let a tiny minority shoot its way into power."

He also said, "Some people still seem to think that our concern for security assistance means that all we care about is a military solution. That is nonsense. Bullets are no answer to economic inequities, social tensions or political disagreements. Democracy is . . . . The real solution can only be a political one."

"Negotiations are already a key part of our policy. We support negotiations among all the nations of the region to strengthen democracy, to halt subversion, to stop the flow of arms, to respect borders and to remove all the foreign military advisers, the Soviets, the Cubans, the East Germans, the PLO, as well as our own from the area."

"A regional peace initiative is now emerging," Reagan said in reference to efforts to promote a conference of Central American and other Latin countries to address regional tensions. "We have been in close touch with its sponsors, and we wish it well . . . ."

On the immediate aid problem, the administration contends that training and keeping the Salvadoran armed forces supplied with ammunition and other equipment requires a large increase from the $26 million authorized by Congress for the current fiscal year.

Reagan's proposal is to take $60 million from funds already appropriated and $50 million from the administration's recently submitted $462.5 million supplemental request for fiscal 1983.

The supplemental, which still must be considered by both houses of Congress, originally contained no money for El Salvador. Now the administration plans to shuffle its request by cutting its recommended aid levels for other countries, reportedly Morocco, Colombia and Ecuador, to accommodate El Salvador.

Reagan also said he will ask Congress for an additional $20 million to provide $17 million in increased military aid to Honduras and $1.5 million each for Costa Rica and for regional security training at U.S. facilities in Panama.

His $168 million economic assistance request involves reprogramming $103 million in funds already appropriated for other countries and $65 million in new funds.

If approved, it would give $67.1 million to El Salvador, $60.1 million to Costa Rica, $34.1 million to Honduras and $6.7 million to Belize.

In addition to the impending showdown in the House subcommittee over the reprogramming of military funds, Sen. Alan Cranston (D-Calif.) charged that Reagan "is advocating steps that would turn El Salvador into another Vietnam" and said he would seek a vetoing vote in the Foreign Relations Committee, of which he is a member.