Great project.
There are going to be lots of challenges to overcome. A metho burner will likely wreck the paint regardless of the type. Looping through the flame causes thermal runaway and will chew through the fuel too fast to heat the boiler properly.
The best option would be a flue boiler (flame tube) with a butane burner, cleaner, hotter and keeps the flame away from the paintwork.
And there are plenty of plans, ideas etc on the web for converting and building steam trains, trams etc to give inspiration.
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I've seen some videos covering a gauge 1 'Cracker' loco which is gas fired - perhaps I'll try it - hopefully the gas will burn OK in a 15mm fire tube as that's about as big as I can go..
I am sorry if I'm dousing your aspiration, but as someone who has been playing with O gauge live steam for over 65 years, there are limitations. The scale of Gauge 1 makes many things much more feasible, but flame, steam generation and piston efficiency don't scale down.
The big downside to your one, oscillating, single acting.cylinder, is that although its port admits steam when the crank is coming up to the optimum position, the piston isn't, As you only get 1/3rd of a power stroke, and the driving wheels (plus your crank webs) rotate too slowly to accumulate much flywheel effect, you need two cylinders, which consume twice as much steam.
It can be done, I have a Bowman's O gauge live steam tank engine, but the external cylinders and connecting rods leave a lot to the imagination, compared to my Bassett-Lowke locomotives with their double acting, valve operated cylinders.
BUT
Please don't let my 2d worth spoil your fun of fitting all the bits into your chosen space.