Split don't give up on the engine yet. It actually doesn't look bad. Clean the outside off. Do NOT turn the engine over. You could grind dirt into the engine parts. Remove the muffler, carburetor and backplate. Use some carb cleaner and flush the gunk out if there is any. Clean the carb out real good. Look in the exhaust port and see if there is any debris in there. If there is remove the cylinder head and flush it out. Make sure it is clean inside. Use some afterun oil and assemble it. Get a new prop and spinner. You should be able to run it then. I see it has a remote needle valve. Check it out thourougly for damage. You may need to replace the high speed needle. Clean it out and fix it up and you should be back on track with the engine. Good luck with it.

BTW the plane can be fixed fairly easily too. See if you can get some help. If you cannot get a replacement under warrenty I would fix it and continue on.

Mark Shuman