Thanks for some great ideas everyone, lot to think about.
Currently I am leaning towards the built-up approach like Capt. Jerry suggested, think it will fit my tools and materials best, while giving me leeway to redo parts of it if needed (which means it will all go perfect, according to Murphy, but thats okay too!). I did some drafting on it, and in order to get the fastener holes around the shaft holes and cylinder ends, plus to leave a reasonable thickness on the end of the cylinder core where the end plates go on, I am going to make one tiny change - moving the valve bores out from the cylinder just a bit, which also means the height of the block is slightly taller.
In doing more research on this type of engine, I did see some diagrams of the engine blocks without all the insulation and covers, and as Jerry said, this is about what they looked like. Mine will get plates to cover the sides/top so end result will look like the MEM plans.
Below is a sketch of where I am so far - the cylinder core piece will be 1.5" round (which is the limit of how big I can hold in the 4-jaw with the jaws normal way, which gives most surface to the jaws), stepped down at the ends to form a shoulder the end plates can seat against and also give clearance for the valve bore. The end plates are thick enough to take the bolt holes for the outer valve plates. I did not show the steam/exhaust tubes like Jerry did, but will put them in like he showed. Only functional difference from the original MEM plans is the distance from the valve bores to the cylinder is longer, but that is a fair tradeoff for keeping the cylinder core ends thick enough to be strong. The difference is small enough not to effect performance at all.
Again, thanks all for your help, build will probably start in the next couple weeks once some other projects are out of the way.