Personally, I feel much safer with an engine bolted down on solid 2X lumber than with the typical metal straps clamping the engine mounting tabs. I don't mean to dismiss the value of a good commercial test stand, but if you're handy with the basic wood working tools (circular saw, jigsaw, drill/driver etc.), you can build your own test stand that will mount any size RC engine safely and securely - certainly much more so than the typical installation in an RC aircraft.

As far as the choice of wood, I prefer the common SYP (southern yellow pine)or DF (douglas fir) dimensional lumber found at construction jobsite everywhere. The cull lumber bin at your local lumber yard is also a good place to look for cheap material. 3/4" plywood is okay but not as convenient to work with as 2X sticks. Skip the WW (white wood) crap at Home Depot and Lowes. They are way too soft.