Hi Ron
"What sort of transition from engine exhaust ID to mini pipe ID is desirable and allowable?"
None really. You can't taper the pipe towards the exhaust stub so just stick with a 90 degree angle. The 90 degree angle differentiates the header portion of the mini-pipe (where it attaches to the exhaust stub) from the actual pipe. Proper length and diameter of the pipe are far more important anyway.
"I notice from photos I have looked at that there are no cooling air inlets in the engine cowling, and cylinder head fins are exposed. Is this adequate cooling? What is recommended?"
Most of the 21's are built on a large crankcase relative to their displacement. Consequently they take a bit longer to heat up and run properly than most other engines. The 21's seem to like to run hot, at least mine did.
I did not find engine cooling neccessary, however, you might want to cool the header area of the pipe. That might help "O" ring life a bit.
Regards, Les