The 3oz cloth will give LOTS of strength. For future reference, if you do build another small hull like this, and you want to use cloth, you can go with a very light cloth, like .5 or 1oz weight. Again, these small hulls, built WOF style, or even frame construction, end up very light, which for this size engine is what you want. They will very rarely get damaged if hitting something in the water, or even on shore. They tend to bounce off things instead [X(]
Are you going rudder only? (no throttle)
Give that Cox some 25-30% nitro and let it scream. Also, make sure the fuel you use contains all, or mostly castor oil instead of synthetic. These small engines like the nitro, but burn up fast if a synth oil is used. The castor oil helps big time with the cooling as well as lubing better.