I plan to recess a 2 oz circular fuel tank with external diameter of 1-3/8" into my profile Half A Pathfinder fuselage. Will the fuselage be too weak to accept a recessed circular grove that is 2- 3/4" long

or would a 1 oz circular fuel tank with external diameter of 1-1/4" external diameter and 2-1/8" length be better

I have used recessed fuel tanks for years.   Just be sure to re-engineer the front end with enough hardwood & plywood to do the job.  I would have hardwood/plywood going back past the high point of the wing.

Hmm, no contact info posted for Casey.
Wont challenge Paul's input, wood removal and replacement for strength "might" result in a heavier plane. I've seen Paul's Baby Clowns fly and they are super.
Adding weight to a 1/2 A P'finder is not recommended.

Mine have weighed ~11 oz. each. Hundreds of flights on 48' lines. Have some ideas, next one will be lighter.
Roger V.