Speaking as someone who likes their AH fairly plausible and knows nothing about sleeve valves, I'm enjoying this.
Yes, converting a petrol aero-engine to diesel sounds a pretty silly idea, but then it's been driven by a pretty silly War Office requirement. And the whole thing being driven by Treasury penny-pinching over engine costs feels entirely realistic.
I suspect that OTL designers were probably besieged by enthusiasts claiming that their pet engine design was so much better than everyone else's pet design that obviously the whole tank should be re-worked to use it...
What was becoming clear from the Spanish Civil War was that tankettes and light tanks had very limited value.
The penny is beginning to drop. On paper - and as long as you assume that the opposition will consist of infantry without heavy weapons - the MG-armed tankettes look great. In practice, they suffer badly from being big enough to attract attention from tanks, AT guns or artillery, and too small to survive it.
Have the observers also noticed that it's very hard for a tank to effectively suppress AT guns/artillery with MG fire without getting dangerously close to them?
And be relatively cheap
A lot of tanks in the late 30s were either direct copys of the 6 Tonner (which was heavier than 6 tons) or where heavily influenced by them
A 9 ton version mounting the 2 pounder and a coax with a CS version mounting a 3.7" howitzer mountain gun - each with a 3 man crew would serve admirably IMO.
The T-26 was the best tank of the Spanish Civil War because it was the one with a decent gun. Problem was, it had the same tinfoil armour (~15mm) as all the others, so while it was largely immune to MG-armed German and Italian tanks it was still vulnerable to AT and artillery fire.
And upgrading the armour is hard, because the weight kills the performance quickly and there's no room in the chassis to upgrade the engine.
It comes down to what you want your light tank to do:
- Do you want a pure recon vehicle that isn't meant to get stuck in? Then mobility is essential (especially off-road) and something like the OTL Light Mark VI is probably effective
- Do you want what is essentially a light tank-destroyer, with a good AT gun and decent mobility, forget the armour? Then something like the Tetrarch
- Do you want a cheap stand-in tank that will hold the line in 1939-41? Then an enlarged 6-tonner derivative will fill the same sort of role as the T-26 or Pz38t (both around 10 tons), just don't expect it to be viable after mid-war.