I can't see why it should be unbalanced, appart from a lumpy idle. There are still two cylinders opposing each other, and balancing thing out a bit. Now someone just has to go try the A3 engine...

EDIT Looking at it, the only problem would be that the oil feed for the head will be cut of. But I guess one could simply drill through the block into the main channel below, and then into the head, do a shimmy on the middle headbolt, problem solved. Your oil pump should still be ok, but you might have to come up with some creative plan for the dip stick, the hole to that will be cut of as well. Furthermore one would probably have to add some counter weights to the crank to get it not to shake itself to pieces. Other problems might be the ignition, but filing off some of the trigger lobes should solve that.

Mmmm, my son's go-kart needs an engine, and I always have some time to kill...

If someone knows of a similar A12 engine lying around, let me know...