Hi Erwin
You have begun!
As for the tube notcher - I used a drill press and bolted a vice to its table. Notched every pipe like that... Just be shure to use a holesaw-holder with morse taper designed specifically for a drill press.
Do not use the standard drill chuck!
also - leave the centering drill in the hole saw and keep the rpms above 700
You might consider buying another 35mm holesaw as you will propably destroy the first one like i did
As for your diff if it is upside-down your buggy will be going in reverse - i think - so that should be a no-brainer
If you haven't allready bought an engine - take a look at bmw motorcycles they are cheap, reliable and are usually shaft driven. And if you are completely nuts take a look at the yamaha vmax
Cheers
Daniel