Great job so far RCkid!

Darren's suggestion of getting lighter covering is a good one, but I've always covered my Half-Wits and Edgelings with the covering you have in front of you. You need to be careful when shrinking the covering, as it is possible to induce a warp into the surfaces, but I like the toughness of the heavier covering. I would also suggest following Darren's suggestion of reinforcing the corners.

As for the engine, go for the .074. You will have to mount the battery behind the servos, but the resulting center of gravity will be much better that way. Powerwise, the .074 is a good leap ahead of the .061 with a very small weight penalty.

Looks great so far!