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Because this is an Onan issue, I am going to move it to the Onan forum so that it catches Boomer's eye.

In my opinion, you could just address the front bearing and seal problem and not touch the rest of the engine to any great degree. However..............since you have to spend the time to tear it down and re-assemble it with new gaskets...................perhaps cross-hatching both bores, installing a new set of rings, checking the end gaps on those rings and polishing the crank journals would be money well spent. To go a bit further, cleaning up the valves and lapping them in would also seem prudent. Even though the 120 PSI readings are excellent, the above would go a long way toward extending the life of your engine for a very low cost. .
 
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