What did you end up going with? I am in a similar situation. I just bought a 1969 Islander 36, but the Volvo
Penta is not currently working and there are major components to the 110s saildrive missing. I was aware of this when I bought the boat don't worry the price
was right to compensate.
So since the volvo
penta 110S saildrive is extremely hard to come by parts
let alone a extremely expensive, and with no real guarantee on the inboard being completely corroded inside it might be a better long term solution to look into a new (refurbished) inboard and saildrive together.
The boat allows plenty of space for just about any mounting. Looking for something diesel
around the 14hp range. Looking for a good long term solution that will be easy to maintain, source parts
, and cost effective configuration. Till then I can easily mount an outboard but taking my time researching possible solutions.