Jim...The G85CS engines after 1965 had the magneto out the front from the factory to, like you say, help cool them in race conditions.
Wally, Jonesys Cheney Matchless is indeed the bike Peter Scaysbrook would have been riding at Moorbank in the late 60s. In 1969 he moved on from it to a works DT1 supplied by McCulloughs and prepared by Vic Lyons and won a lot of titles including the '69 NSW title at Moorbank. Peter got out of racing prettyearly to pursue his career as an engineer overseas but made a brief comeback in the mid 80s to ride Jack Crowhursts controversial ESO powered Norton classic road racer and kicked arse but once again retired when the bike was banned from racing.
The Cheney Matchless was built and raced in the UK by Brian Curtis who later became famous as the original HL Yamaha frame constructor. The engine is indeed a compy all alloy G85CS version but is pretty special as it's a genuine 'X' numbered works engine fitted with an AJS 7R rod, BSA Goldy piston and a bunch of unobtainium works parts. Curtis's cousin was Geoff Curtis, the Matchless factory GP rider and it's guessed that the engine may have been snuck out the back door at night! Alan has spoken to Curtis about this and he's very cagey about the engines origins. Coincidentally Roy Easts Metisse G85CS engine is also a works engine that was smuggled out of the factory piece by piece by Easty who worked in the comp shop at the time! The only thing not works is the engine number for obvious reasons. Alan has restored the bike to the exact condition it's shown in the photo and he's taken it to the last two CDs.