I haven't built the new kit, but built the original about 34 years ago. It had an Enya .45 in it, which was adequate at the time. Any of today's .45 2 cycle engines would be more than enough for it. Going much bigger adds needless weight and you will probably never need all that power. Mine started as a trike and got converted to a taildragger, which handled much better. I have to wonder why you want to fuss with retracts though. It's a small model to start with and you will be cramming alot of stuff into a small space, adding to the wing loading and complexity. More stuff to go wrong, more weight and it's also a little harder to make out what is going on in certain attitudes with the gear up, so why do it? Been there, done it, so I understand the novelty aspect of retracts, but it doesn't do a thing to make the model fly better. Oh yeah, add the risk of a gear jam running down the flight battery, unless you take up even more space and add more weight with another battery. Why?

Re. the flaps, mine was just coupled directly with the elevator, but I would make them separate this time around, use a mix and throw it onto a switch or flight mode to allow you to use them coupled, ala the way a CL stunter flies, or decouple them for landing, spoilers crow etc. Should work well on that model. It's a great flying little airplane and I will probably do another one someday.