Suggestion: Mount the engine to the seat tube then fabricate the front mount. If chain guard clearance is your issue simply raise the engine until it clears, then mount it there. Just make sure the front mount is centered so the engine isn't cocked off to either side.
Another point is to not mount the engine with rubber or some other resilient material between the engine and frame. Mount the engine solid to prevent future fastener/mount failures due to vibration. Oh, and pick up some more black paint