Oh no, here we go on oil again :biggrin:
You'll be safe with 40:1 oil mix. Stock mixture ratio is a bit higher, but at 40:1 it helps in case you end up having cooling issues or an air leak or something where the engine isn't running in the optimal condition.
Your next question is probably going to be oil type. Since you are not running a heavily modified engine, basically, any TC-W3 spec oil will be fine. I personally like the synthetic because it doesn't smoke as much. Others by the cheapest they can find (usually Wally World by the gallon), others buy the most expensive.
A wet pipe is a modification where you change your exhaust from the engine to the water box and install a much better performing unit. The most popular wet pipe here is the Factory 'B' pipe. These pipes are tuned to scavenge the gases from the cylinder and aid in filling with fresh air/fuel mixture. It's the best power for the money, but they run around $400-500 used.
Cool project. Got me thinking about all these old crapped out boats sitting around this area and how cool it would be to do something like this.