Well, too late: a few days ago it finally got warm enough for me to work in the garage without me freezing too much. I did mess with the governor shaft lock cross bolt (as per the adjustment procedure specified in the Generator Guru troubleshooting flowchart). I also replaced the small spring which encircles the governor rod (it had popped off a few times and looked a bit wonky). After doing this adjustment/replacement the surging was gone. I can see the (rough) measurement of 120 volts on the analog meter of the generator. I need to now measure the frequency (I may have a meter that can do that, otherwise I may invest in a Kill-a-Watt). I was able to power a couple of heaters without a problem but have not done any more quantitative tests on capacity of this 2500 Watt generator.
Interestingly, the clone carb I installed leaks fuel. When I opened it up I saw no problem with the float/needle. I applied a bit of pressure with my mity-vac and manually moving the float up creates an air seal. So nothing obvious. I ended up putting the original carb back on (which has an idle fuel screw that cannot be adjusted because the end has broken off) and the fuel leak is gone and the generator runs fine without surging.
I have been watching James Condon's videos on generators/etc. Agree that this is a wonderful source of learning.