KEEP THE PICTURES AND BUILD DIARY HERE! Inevitably, there will be someone else in your position in a year or two asking the same questions and it's always more helpful to have a lot of build diaries to refer them to.

7/8" axle is about right. You wouldn't want to go much smaller anyway. As to connecting the two there are a number of options, some people weld sprockets and gears straight onto shafts, you can drill straight through the sprocket and shaft and put a pin or bolt through, there are various clamping systems available or keyways as you mentioned.

I remember the feather you mentioned and it was built by John from Scorpion. Had a perm 080 motor if I remember right.