I'm in the same trouble. Yes, I've read lots of threads about engine painting. I tried to do it with VHT, and you can see in the pictures the results. I cleaned, degreased, sanded, painted and cooked the piece, and it came off with my fingernails. Maybe I didn't do everything correctly, but I CAN'T DO IT BETTER.
I've considered powdercoating it (including barrels, cylinder head and cranckcases), but I'm afraid about the engine overheating, and the bending of the pieces due to the temperature involved in the process. Also, maybe the powdercoat also chips, and you can not retouch it.
So, maybe the best way is two-parts paint. I went to a car tuning shop, and they told me that they could paint the engine and that it would be very durable. They told me also that rattle cans are just for crap. Should I believe them? Is there any two-part paint for High temperatures? Probably the temperature on a cylinder head of an air-cooled engine is much higher than the temperature on any car's engine...
But maybe two-part paint would be the best method, and at least is not as irreversible as powdercoating. You can retouch it, anyway, and is not agressive to the pieces. Any experience with two-part paint?