Chuck,
I don't know the model, how much room inside?
The rudder arrangement is likely to be the most difficult part to arrange. If there is insufficient room to install a (mini) servo for steering you may need to consider the chain type of steering found on early steamers (and the rope equivalent found on sail driven vessels.
Whatever, i would concentrate on this part first, then the propulsion where you wil have much better choice.
If you have not done so already, make up some card templates for servo outlines to give you an idea of what arrangements may fit. see
http://www.futaba-rc.com/servos/servos.html for typical dimensions.
J.