Ya I'd be really weary about running it like that. I mean you can but why waste the money on having to get new cases etc. when you know it's going to crater and soon.
If you want a playbike I'd suggest a 421 serval or even a stock stroke serval. Just depends what kinda crank you have laying around (thought you said you had one) and what not.
Give Andy at M&M a call. He has 1-day shipping to the dallas area which is sweet IMO.
Ya, hell make sure you put a rag under the piston when you pull it apart in case any pieces decide to fall apart. If you run into any issues holler at me, I'm just over by Cleburne.
I don't know what the actual spec is, but I would think it would only be .5mm to 1mm of rotational play just from all the tolerances in the separate components. Replace the bearings and see if it helps.
My 4mil cub with similar mods and 35 pwks has 155 main and a 48 pilot. That's around 1300 ft. elevation and I believe it is a safe jetting. You might want to start a little higher just to be safe though.