Mini bikes have been around for a while, https://en.wikipedia.org/wiki/Category:Minibikes
That is why I refer to them as a cyclical fad, the Chinese are jumping on the band wagon and nearly every manufacture makes one.
There are manufactures in China making high output horizontal engines, those engines all of them have potentially short lives.
There was a member on the site that used to race them TB for tiny bike.
Buying a real Honda and then pulling the engine seems like a waste, its the engine and PMFI that makes it better. Do they use the EFI or do they use a carb on the race engine, seems a good way to learn mechanics and part of the fascination with the minis is in that cheap and lots of parts that are not always cheap but relatively speaking much cheaper then what it would cost do the same on a full size race bike.
As far as the engines and swapping, the problem is when and if you get caught speeding or worse an accident, because under scrutiny you default to ridding an illegal vehicle.