There is no problem using 530 chain on a 520 sprocket, so I can't imagine there's an issue running #50 chain on a 520 sprocket. It has a little extra side play, true, but it isn't a problem.
As for the ratio, I'd go as low ratio as you can. Your tyres are smaller than the bikes, meaning it's already a slightly lower ratio, but even lower would be better imo.
I went from 16-39 on the bike, to 14-50 with the same size tyres. If I had found a 60 tooth rear sprocket and a 13 tooth primary I would have used them, no question. In my experience it's impossible to get too low a gear ratio, but with a jackshaft it might be different because you can get a seriously big reduction that way.