I am doing an 07 KTM 300 right now. I started building it in 07, I haven't been in a hurry to finish it since this one is for ME.
The only real problem with using KTM's is that the early ones (80's) had the ignition on the wrong side which would have made it tough to make a good bikesaw. A 98 will have the ignition on the left which will work fine, I think 93 and up all have the left side ign.
The right seal rides on the primary gear instead of the crankshaft like a honda CR250 does so you do need it. I like how the reeds cage feeds directly into the crankcase on the KTM instead of the cylinder head, it makes the package more compact for a saw, and makes it easy to pull the jug.
It should make a great saw.