When I re-read the original post, I realized how little power we're talking about here - a 300 CI engine (or even a 225 slant 6) wouldn't be making enough power to be happy at only 20KW. And frankly, anybody not running serious machinery a lot of the time probably doesn't need more than 20KW for a house.
If this is going to be a backup generator, and you only want it for power, and only for 30-35 HP, I am going to risk derision and point out two choices you may not have considered:
1) a type 1-3 VW engine (1600 CC, big oil cooler). Or a type IV (105-130 CI) up to if you think 100 CI isn't enough to get the job done. Small, cheap, simple, parts and engines available everywhere, air cooled, so no winter water jacket worries, and easily capable of 40 HP all day long. IMPCO has made carburetors in this size range forever for forklifts and the like, so gas carburetion is cheap and simple. Downsides: They're not really all *that* reliable, require some tweaking, and they have that VW 4-cylinder burble you may not like in the back yard at full song. Availability of 35 HP at 1800 RPM on the smaller engine might be a bit marginal, so you might have to go belt drive to get up to about 2500 RPM at the crank. A type 4 coluld easily drive at 1800 all day for that kind of power, but parts are kind of expensive, which leads me to:
2) a corvair engine direct drive at 1800 RPM. 35 HP at 1800 is about right for the smaller (and cheaper) 145 CI engine . Being a six-cylinder, it has smoother power pulses and (I think) a nicer exhaust note. Same lack of water jacket advantage as the VW. Use the 102 HP heads for high compression (good with methane) and run crossover pipe (cheap and common) to a single gas carburetor. Looking at a stock engine test report, max power at 1800 is about 45 HP, so 15-20 KW should be enough to keep it warm and happy with good BSFC, but not enough to be a cooling problem. Stock everything should be fine at this power level for this application - I demand a lot more of my mostly-stock van engine.
I've seen several military/industrial/stationary corvair engine installations (it was the prototype engine for the GAMA Goat, among other things). If this interests you, I can certainly help with details of such an installation.