You might doublecheck NY's policies on small gas engines. Most states allow them up to a certain size (typically 49 or 50cc), horsepower (1.5 brake), vehicle speed (sustained 20mph for example), etc., as long as they can be pedaled. There are different classes, and some are less regulated (helmets, insurance, registrations, etc.). I have heard stories about (and had my own experiences with some) cops, DMV employees, shop owners, and even judges who do not understand the exact details of these laws, so you have to do a little careful sifting or digging sometimes to get at the truth.

Honda generator engines are quiet, as you have seen. The same engines can, I was told, be purchased separately. They are potentially just as quiet, or quieter (since the electricity-generating components are absent).

Sounds like a fascinating project -- please keep us posted.