Hi B_S,
I think that the main issue with the Kirby is the butterfly in the carby which gets worn and thus allows air to get into the system unmetered, thus this makes the engine hunt up and down. Apart from that they are generally fairly bullet-proof if running well. Another problem is that they'll profusely leak oil out of the Governor shaft outlet bush which becomes a real pain.
You H4 is a 2.5 HP engine which is more than enough power for a 14 inch Scotty. The problem with most of the replacement engines available nowadays is that they are huge on a 14 inch machine. Now if you had a 20 inch it wouldn't be that much of an issue but the 14 is a rather compact little machine. Also the handle bar assembly would interfere with the current engines as they are built more rear ward opposed to the older engines that were built more upright or even forward as was the case with the Kirby power plant with forward facing fuel tank.
Personally I would spend some time with the current engine and see what you can come up with there opposed to spending lots of cash on another engine.
Cheers,
BB.
