A few things to check out before you rebuild:
1.) How is engine compression?
2.) Does the engine smoke? If so, when? (opening throttle or all the time?)
3.) Are the engine cooling fins choked with grime and dust? If so, it will cause overheating and loss of power. If the engine gets severely over heated it will also smoke.
4.) Remove the head and valve cover and check the following:
A) Valve clearances - with the engine at top dead center on the compression stroke (NOT MID-STROKE between intake and exhaust) you should measure .008" intake and .010" exhaust. A simpler test is to see if you can rotate either of the valves on their seats with your thumb. NOTE - if clearances are bad you may not need a rebuild, just a clearance and carbon job, perhaps just a lap in on the valve faces while you have it apart.
B) Turn the engine to mid-stroke - intake, and try to move valve side to side. You are checking the valve stem clearance, do the same on the exhaust. if there is more than .005" wobble, the guides will have to be re-done, not an easy job for a first timer.
C) Look at the cylinder bore. Is it scored (vertical lines scratched into the surface)? Is it aluminum or cast iron? The IC series has a cast iron liner and is rebuildable. I would not bore an aluminum engine. Once the cylinder surface is disturbed, it will wear out quickly.
D) Check the carburetor tank gasket, diaphragm (if more than 2 years old, replace it), carb mount flange gasket, and also check the flange for overtightening warpage. If warped slightly, file flat. If severely warped, replace. DO NOT try to bend, the flange ears will crack, and fail.
E) Remove the flywheel and try to move the crankshaft up and down, as well as side to side. If it moves up and down more than .003", install thinner sump gasket. If there is more than .003" side to side and the engine is a standard engine, replace it. The bearings are the block and it is not worth sleeving. If the engine is an IC series (ball bearing) and play is excessive, have the bearings replaced as well as the seals. NOTE - if the crankcase breather is clean and oil is coming out of the seals, check crank play!
F) Check con rod play and crank journal for scoring. If all items clearance OK, then proceed with rebuild. If you have to repair more than 50 % of the items (for example the block is shot, and the crank is worn or the valve guides are wiped out, and/or a valve seat is loose in the block and there is scoring in the cylinder), then a short block is recommended rather than a rebuild. It will be cheaper.