Yes Grumpy you are correct - all that fiddling around with the Honda engine location / relocate clutch was due to the need to have the engine entirely inboard of the chasis. If an overhang wasn't going to be an issue - then changing to the GX140 would have been a straight bolt on job.
My muffler conversion was just a silver solder braise exercise with some 1" thin wall copper tube - its been there since 1980/1981? as I had the same problem with the exhaust blowing up into my face, which is the pits.- The elbow fixed it - not pretty I know - but it works and has stayed together for 30+ years