I would like your very original oil pressure activated shut down approach more if you could raise the oil pump inlet so that pressure was lost when the oil level dropped below the safe operating level. The problem may be that the oil level may be too agitated by the splash system for this to work well, you may have to create a special chamber for the oil intake so that it is fed from a hole on the bottom and vented through a hole at the top, and isn't affected by the splash. I like the direct simplicity of this method, with zero electronics.
I use a much more complex electronically controlled system that supports multiple auto shut down signals; oil level high or low, excessive vibration, high head temperature (coolant loss), and rpm out of range. For oil level I use a magnet in a float, inside a vinyl oil sight tube to trigger a reed relay. The sight tube connects to the former oil drain and goes up to a 90 degree hose barb connected to a threaded hole in the crankcase. This is cheap and effective as an oil level sensor, and I get an oil level sight tube. (I actually have two sensors zip tied to the tube- one high and one low.) The magnetic float in sight tube method has no problems with splash, it is slow and shows the average oil level.
The reed relay signal is used to drive a rack closer, in my case a pneumatic cylinder controlled by a 12v solenoid valve. I use the same control as part of remote/auto starting and stopping as well. Since your shut down is for low oil emergencies only, you might consider another method I experimented with- a brass wire "fuse" held by two terminal strip screws which holds the governor spring. When 12v is applied to the brass wire it breaks and the governor then closes the rack. I did test this repeatedly and it works very reliably.
Auto shut down for low oil, etc. are not really optional for me, I'm just too forgetful to not have them. I've twice had low oil shutdowns that saved my engine from my memory problems.
