flooded inlet (fluid level above pump) is always better, but thousands of industrial units are built with the electrtic motor sitting on top of the tank. I would not worry about it. Just keep the inlet large and minimal restriction, adn watch your cold starts with thick oil.
The issues are not so much 'loss of prime' as this is not a centrifiugal pump , not like a water pump. The gear pump and system won't run back. The total loop is a circle and the head pulling on one side is balanced by oil in the return line pulling the other way. It can pull air through a bad shaft seal, but a foot or two of negative head is no big deal. As long as the system is tight, it won't run back. The gear pump is in theory at least all sealed with tight clearances between gears, etc.
The main issue is simply the actual pressure at the pump inlet, to avoid cavitation. That is far more destructive than a bit of air.
Don't run an unvented tank. Many of the cheap ones have plugs for fill port. Pressure is no big deal, most pump shaft seals can take a few psi of positive pressure. Pulling a negative pressure is more troublesome. Than it can cavitate the inlet. You need some thermal expansion, but mainly the volume of the steel cylinder rod has to be made up in the oil level rising and falling. Get a good spin on filter element on as a breather/vent. Run it several inches up if you can to minimize oil vapors and splash coming out, and minimize drawing in water vapor from rain splashing on a flat metal surface.
First start: You can pull the pump over, or just crank the engine. Gear pump means open center valves, and the pump ouput goes through the manual valve to tank at no load. No worries. Cycle the cylinder to fully purge air WITHOUT putting any load or building pressure. Compressing air in the cylinder doesn't hurt the cylinder. But the big flow surge when the cylinder goes to retract, the compressed air blows oil back to tank 1 to 10 times normal pump flow, maybe more. Can easily blow the return filter or hose.
Nothing fancy required. I'd fill the pump inlet if you can. If not, crank it over for a bit then start it up and stay at low idle.. Purge the air, cycle the cylinder a lot in mid stroke, longer stroke each time. Then light loads, then go to high idle and go to work.
So I'd get whatever engine works out best for packaging and budget, and mount the pump where necessary. Just not inside the tank..... Those old Williams systems really sucked. And some small industrial power units with vertical electric motors and pumps in tank...... ick for service.
kcj
I was doodling at work today when I should have been working.
