As I mentioned earlier in this thread "get another rear mount bracket and double up in the back of the engine, that will bring the engine foward"and allow you to mount the engine firmly & securely to the down down tube and depending on how much of the peddle is hitting the engine you would probably raise the higth postion of the engine, also allowing for peddle clearence too, a very simple a cost effective solution that shouldn't cause panic or greif, if all else get another frount mount and of course get longer bolts to accomendate for the length of extra material.
Do some shopping! on either side of this posting page, of this thread are several M?B vender sites to get the extra mounts and or other fastener type kits, some very costly! some moderate cost, some low cost, but again DON'T TRIP! it is a simple fix.
If the peddles still don't clear then go to any of the sites on either side of this post and look for a wider peddle assebly kit, usually the 3 piece bottom bracket(commenly known as the crank assembly) is sold with the wide peddle kit, the peddle arms should be 1/2" thread and except the peddles that are currently on the bike.
SIMPLE FIXES BRO, DON'T PANIC! and search this forum for other solutions as well go to search type in china mounts, how to mount a china engine, different mounts, this forum is the best place to gain knowledge about anything regaurding a M/B