You can clean that up easily to make a good motor. If you want more power just take the magneto flywheel and with a dremal grind a keyway for the woddruff key that's about 1/8 inch counter-clock wise from the slot that's there, you'll gain 500 rpm.

The 26 SPEs from BMCA and Brillelli are good also, if you want a rear carb the LS-26 is a good choice.