I like it! I would suggest a Yamaha XV engine or similar. Shaft drive so you can minimise the chains/belts. They have a classic look and a 90 degree V. A big inch Harley would be cool though.
The Yamaha XV engine is just the sort of thing that I think would fit wonderfully in a modern cyclecar. I have a water-cooled variant (from a Yamaha Vision) that I would love to build into a cyclecar if only I can get the flywheel off the crank enough to fix the starter clutch... That's the problem with the Yamaha V-twins, no kickstarter and design flaws in the starting system.
I use the Honda CX650 v-twin watercooled engine in my JZR three wheeled cycle car. It is very reliable, shaft driven, and 65 horsepower in stock form. The car weighs just under 800 pounds.
I envy some of you folks in other states, with your 3-wheelers and such. The trouble with using a fourwheeler motor is that many localities (including mine) require an EPA certified (or like-type) motor. So I can build my own small block chevy from bare parts because you see those on the road, but not use a snowmobile or fourwheeler motor since those are not street legal powerplants. I also can't have a 3-wheeled cyclecar without either wearing a helmet or giving it a non-removable hard top, and even then one needs a motorcycle license to operate it. Even an old Morgan 3-wheeler roadster is registered in my state as a motorcycle and requires both a helmet and an 'M class' permit to drive on the street. Sometimes it*****s to be me. But keep the pictures coming, especially those of you who have managed to build your own.