I have an LT-40 and I just used straight 30 minute epoxy painted on the entire engine compartment, fuel tank compartment, and also the piece of exposed plywood that extends out on top of the fuel compartment. It worked fine! You don't have to reduce it with alcohol at all. I used Tower Hobbies 30 minute epoxy. I just used a stiff little brush - one used normally for applying flux when soldering - and cleaned it off with isopropal alcohol beforehand and also when I was done. One suggestion is to remove the fuel tank cover when doing this or else you'll epoxy that to the top of the fuselage by accident.

If you have any other questions specific to the LT-40 ARF, ask away. I just completed assembly a couple weeks ago and have gotten a lot of tips here on RCU and RC Groups as well as from guys at the club so may be able to help you out some, even though I'm a newbie.