As long as the
davits are sturdy enough, the
lift points on the dinghy are sturdy enough, you can secure it adequately, and it lifts high enough that you won't dunk the
outboard with a wave when heeled, I see no problem with lifting it with the outboard installed.
I'd probably go for a triple block (6:1 purchase) for ease of lifting, at least on the end with the outboard (as that end will likely have 2/3 - 3/4 of the total weight)