Not so fast guys.
In short, the three speed hub bit the big one about two miles into the latest shakedown cruise. While pedaling the two miles back home I came to the decision that three speed hubs are great for what they were designed for, but aren't setup for the kind of power a Honda puts out.
I was almost at the two mile turn around for my mid-range shakedown rides when I slowed and shifted into low. Nothing, the engine revved but nothing else happened. Now if I'd been smart I'd have stopped there and pedaled back, but I wasn't smart. I tried shifting back up into second and there was this as described bang with associated sounds of metal things coming into rather violent contact. Then the rear wheels locked solid as the chain bound up under the three speed hub.
What happened, I think, is when I tried down shifting that little chain fitting that slides into the three-speed hub broke. Anyway it was missing. I know it was tightened prior to the ride because I'd had that link come apart before. The hub lifted out of the mounts slightly causing a misalignment of the chains and everything came together with a whomp. I was able to do a good enough roadside repair that I could pedal the thing home whereupon I pulled out the three speed stuff and set things up for a single speed with the 48-tooth sprocket on the differential.
I might have just had a bad hub, but this was the second failure at the point where the shift cable threads into the hub, and since winter's coming I'd rather have a reliable winter ride than the three speeds. Here's a few more pictures. I'd run the thing up on jack stands and made sure all three speeds worked well, but there's no way short of a dynomometer that can apply torque while running it in the shop.
Several valuable lessons learned though; the simpler the chain guides and tensioners the better. For the trike, a 48-tooth sprocket works better than the 40. And I had to figure out a quick removal mount for the wooden package rack. All in all it's been a positive experience, and I'm not done messing around with gearing yet.
Peerless also makes small transmissions.