250 on a go kart? what would you sugest

How about finding a mid-late 70's UJM 350cc-600cc motor I mean it may be too heavy for your appication but you can pick up a complete junk and make it run. In my earlier years I built an Odessy like vechicle using a CB350 motor and it worked pretty well. If you could find one a suzuki titan 500 or Kawi H1 tripple would be cool.

Maybe on old Honda XR-500 engine would work. It should provide good easy to use power. The downside would be the kickstarter.

I would definately avoid anything that is water-cooled, as it would just bring added hurdles to the conversion.

I took a KX 500 2 smoker engine and shoved it into a homemade frame years ago. We took the pipe and kinda made it work, (stuck it straight up). We had a problem with trying to get a good clutch pedal, (we were young and pretty stupid and most of the time drunk!).
We could never get the nerve to get it out of second, (poor brakes helped).
We welded the rear sproket to the existing one, mounting the motor was easy, it was the other stuff that took time, (radators, throttle linkage, clutch, brakes, the little things).
Make it easy on your self, get an air-cooled engine. I bet you can get a 250/350 street bike motor at a salavage yard.
Good luck, We had a blast working on it, running it for a hour, dragging it back home and fixing it!
Joe

I'd go with an old air cooled 250cc MX engine. Nice and light, simple, plenty of power, and fits your budget. Most anything pre-1980 should be air cooled.

Post some pics when you're done!