If a small diesel outboard existed, I would be one of the fools buying one. In the 50s, small model airplanes used 2-stroke diesel engines rather than petrol. I just wonder whether the same principal would not be possible for a small outboard. A 2-stroke diesel engine must be the most reliable engine possible. In practice we don't use it a lot.
Most navigation is based on dead reckoning and luck.
Our boat moves to much in serious waves to be able to get an accurate bearing, when the boat doesn't move, I don't need a bearing. Remember that with a centerplate design there are almost no worries about shallows, at least not as much as in a keel-boat. 1 steering Compass, mini Contest Plastimo Excellent compass for small boats. Get good, stainless steel tools. You don't need a lot of them.