I think the red loctite is what is recomended. I believe the green will work, although it is designed for repairing loose bearing fits. It fills a void well, but I am not sure how adhesive to metal it actually is compared to the red loctite. As stated above. the green is harder to find anyhow. And be sure to let it sit overnight before running it. The blue loctite is definitely unsatisfactory for the clutch retaining nut. I use a small torch to deactivate the red, as it is so tough it can screw up the threads if you don't. I have heard about using JB Weld also.
To attain the proper torque, you can stuff a length of 1/4" rope into the spark plug hole to keep the crank from turning. This is how tons of folks do it.
As far as the mounting bracket bolts on the head shearing, this is pretty common in the little 50s. They are vibrating little rascals, and anything that is put into a mechanical stress and vibration will break. I am sure this is whats happening. Remove the bolts, and see if there is room for a washer or two under the bracket. You want it to tighten down solidly without deflecting the bracket. As far as that goes, it is wise to do this with all the motor mounts, as the frames on the minis seem to vary in shape more than the big bikes, and often the entire frame is put in a bind because of poorly fitting motor mounts. This may help all kinds of bolts on the bike keep from loosening, as they always seem to do on the 50s.
Rich