Fantastic stuff Ross, the feeling you get when you see your first engine running is immense, I remember it well and still get it now to be honest!
I don't think the flywheel is that bad at all, especially considering the design with 1 narrow bearing. Video's seem to accentuate these little wobbles anyway. If you want my advice, don't bother making anything new for this engine ... you might find it's no better ... move on to the next project!
